The London School of Economics and Political

The London School of Economics and

Political Science

The European Community’s Opening to the People’s Republic of China, 1969-1979: Internal Decision-Making on External Relations

Marie Julie Chenard

A thesis submitted to Department of International History for the degree of Doctor of Philosophy, London, September 2012

Declaration

I certify that the thesis I have presented for examination for the Phil/PhD degree of the London School of Economics and Political Science is solely my own work other than where I have clearly indicated that it is the work of others (in which case the extent of any work carried out jointly by me and any other person is clearly identified in it).

The copyright of this thesis rests with the author. Quotation from it is permitted, provided that full acknowledgement is made. This thesis may not be reproduced without the prior written consent of the author.

I warrant that this authorization does not, to the best of my belief, infringe the rights of any third party. Abstract

This thesis analyses the decision-making within the European Community on opening to the People’s Republic of China between 1969 and 1979. The three main research themes, which this thesis will make a contribution to, are the EC’s decision-making in foreign policy, European integration in the 1970s, and the intersection of European integration and the Cold War. Neither the historiography of the Cold War nor of European integration have dealt with the EC-PRC relationship. This research addresses that deficiency.

This is the first detailed, systematic historical study of the origins of the Community’s response to China that bases on archival sources released according to the 30-year rule. The study takes a Community-centred perspective, focusing on how the interests of the EC member states, those of the EC intergovernmental and supranational actors came together in Brussels, Strasbourg and Luxembourg to shape the EC’s response to the PRC. It is based on extensive multi-archival and multinational research, including records of the Community institutions, the French, British and German governments, personal papers, and interviews.

The thesis argues that the Commission was the principal architect and motor behind the EC’s opening to China. Sir Christopher Soames, the first British vice-president and commissioner for external relations, was primarily responsible for establishing official relations. Personal beliefs and ambitions were at the root of his decision-making. Geopolitics were key. However the principal factor behind his and the Commission’s subsequent decisions was inter-institutional jockeying for power. The main implications of the opening were a furthering and deepening of European integration, and an acceleration of European détente and détente in Europe. This thesis therefore shows that the wrangle for competencies within the EC institutional system intertwined with broader trends of history, the end of the PRC’s isolation from international affairs and détente.

Table of Contents

Acknowledgements ...... 7

Acronyms and abbreviations ...... 9

Introduction ...... 13

1.1 Scope and approach ...... 16

1.2 Literature review ...... 18

1.3 Sources ...... 39

1.4 Structure ...... 43

Chapter 2 Beginnings and a public pledge (December 1969 – December 1973) ...... 47

2.1 Institutionalising trade ...... 49

2.2 First political coordination...... 56

2.3 Fresh impetus due to Britain joining ...... 60

2.4 Growing political contacts do not parallel economic ones ...... 69

2.5 New leverage: the Sino-Soviet competition ...... 75

2.6 Towards a concerted foreign policy: the Declaration of European Identity ...... 82

Chapter 3 Coup de théâtre (January 1974 – May 1975) ...... 92

3.1 The member states’ laissez-faire opens wider the window of opportunity ...... 95

3.2 Trade prospects helped, but did not determine the outcome ...... 101

3.3 Beliefs, personal ambitions, and politics ...... 107

Chapter 4 A difficult follow-up (May 1975 – January 1977) ...... 121

4.1 The EP’s critical acclaim and the European Council’s support...... 123 4.2 The Commission pushes ahead with trade talks ...... 131

4.3 Stagnation due to Chinese domestic turmoil ...... 144

4.4 Attempts of more political presence: the Tindemans Report, emergency relief and messages of condolence ...... 151

4.5 Soviet alarm and the reactivation of EC-COMECON talks ...... 159

Chapter 5 A multi-level deal (February 1977 – June 1978) ...... 167

5.1 Swift resumption of trade talks which the Sino-Soviet rivalry spurs on ...... 169

5.2 Off to Beijing for the second time: the Commission’s skills ...... 175

5.3 The final negotiation phase: playing the Soviet card...... 182

5.4 Signature and ratification: the many dimensions of the trade agreement ...... 189

Chapter 6 Towards more substance (June 1978 – January 1980) ...... 199

6.1 Practising diplomacy: the Commission’s and the EP’s visits to Beijing ...... 201

6.2 The EC’s unilateral trade liberalisation ...... 209

6.3 A delicate task: negotiating the textile agreement ...... 219

Conclusion A new multi-level diplomacy ...... 232

7.1 Boosting the Community’s foreign policy activity ...... 233

7.2 European integration and the 1970s ...... 241

7.3 European integration and the Cold War ...... 242

Bibliography ...... 247

Appendices ...... 278

Table of Tables

Table 2-1: Direction of trade of the Six for 1965 and 1971 in million US $ ...... 55

Table 2-2: Ranking of the first trading partners with the PRC in total trading volume in 1973 ...... 73

Table 4-1: Distribution of EC exports to China in 1974 and 1975 ...... 139

Table 4-2: Distribution of EC imports from China in 1974 and 1975 ...... 139

Table 4-3: Variation in trade in 1975 compared to 1974 between the EC and China for Germany, France and Britain ...... 140

Table 4-4: Direction of trade of the Nine for 1974 and 1975 in million US $ ...... 141

Table 4-5: Distribution of EC exports to China in 1975 and 1976 ...... 148

Table 4-6: Distribution of EC imports to China in 1975 and 1976 ...... 149

Table 4-7: Variation in trade in 1975 compared to 1976 between the EC and China for Germany, France and Britain ...... 149

Table 4-8: Direction of trade of the Nine for 1975 and 1976 in million US $ ...... 150

Table 6-1: Direction of trade of the Nine for 1976 to 1979 in million US $ ...... 211

Acknowledgements

It would not have been possible to write this doctoral thesis without the help and support of the kind people around me, to only some of whom it is possible to give particular mention here.

First and foremost I offer my sincerest gratitude to my supervisors, Dr N. Piers Ludlow and Prof. O. Arne Westad, who have supported me throughout my thesis with their knowledge and patience whilst allowing me the room to work in my own way. I attribute the level of thesis degree to their encouragement and effort, without whom this thesis, would not have been completed or written. One simply could not wish for a better supervisor team.

I would like to acknowledge the financial, academic and technical support of the LSE and its staff, particularly in the award of the Departmental Research Studentships that provided the necessary financial support for this work. In this respect I also wish to thank Udo van Meeteren for his generous financial support.

This dissertation would not have been possible unless archivists and librarians had helped me in locating material across Europe. A particular thanks goes to Joceline Collonval, from the Commission Archives in Brussels, and the entire LSE library team.

Thank you to the European integrationists around the LSE. Without them my research would have been much less alive: Maria Chen, Emma De Angelis, Daniel Furby, Emmanuel Mourlon-Druol, Angela Romano, and above all Eirini Karamouzi - without her I would not be professionally where I am now at completion of this thesis.

I am obliged to many of my colleagues and friends from LSE IDEAS who supported me in the final year of my PhD. Special thanks go to Annalisa Albanesi, Nuala Connolly, Indira Endaya, Tiha Franulovic, Paola Gioffredi, Emilia Knight, Antonio Moneo, Liza Ryan, and Akhila Yechury.

I am truly indebted and thankful to those who read and discussed with me earlier drafts of my work, some of whom I have already mentioned. I would like to mention in particular the help by Leslie James, Katja Seidel, especially Brigitte Leucht, and above all Heather Jones. For any errors or inadequacies that may remain in this work, of course, the responsibility is entirely my own.

I am most grateful for the support and care of Anukampa Barth, Hanya Chlala, Father Iain, Robin Jacobson, Jackie Robarts, and Jane Sedgwick. Thanks to them, I safely learnt many lessons in these last four years which allowed me to fully take in the intellectual ones of the PhD.

A heartfelt thank you to all those who have welcomed me at their homes during my many research trips: Lavinia Hoyos in Brussels, Barbara and Tilman Koops in Koblenz, Irma and Gérman Merinero in Brussels, Ullrich and Ulrike Nielsen in Berlin, family Woestmann in Luxembourg, family

Paulhac in Paris, and family Schmitz in Florence. This is also the place I would like to express my gratitude to family Souter without whose generosity the very start of taking up my place to study here at the LSE as an undergraduate would not have been possible.

Johanna Schmitz, Sofia Castillo, Philipp Nielsen, Laura Staubli, Ketevan Bashinuridze, Emily Gray: without your precious friendship, and knowing that I can go with you 'durch Dick und Dünn', I could not have completed this thesis. Thank you.

Above all, I would like to thank my parents, and my sister who have given me their unequivocal support and love throughout, as always, for which my mere expression of thanks does not suffice. To them I dedicate this thesis.

Acronyms and abbreviations

ACP African, Caribbean, Pacific countries

AdSD Archiv der sozialen Demokratie

AMAE Archives du Ministère des Affaires Etrangères, La Courneuve

AN Archives Nationales, Paris approx. approximately

BAK Bundesarchiv, Koblenz

BKA Bundeskanzleramt

CA Churchill Archives Centre, Cambridge

CAC Centre des Archives Contemporaines, Fontainebleau

CAP Common Agricultural Policy

CARDOC Centre Archivistique et Documentaire, Luxembourg

CMA Council of Ministers Archives, Brussels

COMECON (or CAEM) Council for Mutual Economic Assistance

Comitextil Coordination Committee for the Textile Industries in the European Economic Community

COREPER Committee of Permanent Representatives

CSCE Conference on Security and Cooperation in Europe

DG I Commission Directorate of External Relations

DG II Commission Directorate for Economics and Finance

DG VIII Commission Directorate for Development

DG XIII Commission Directorate for Information

EC (or CE) European Community

ECHA European Commission Historical Archives, Brussels

EEAS European External Action Service

EEC (or CEE) European Economic Community

EG Emmanuele Gazzo papers, Florence

EN Emile Noël papers, Florence

EP European Parliament

EPC European Political Cooperation

EU European Union

EURATOM European Atomic Energy Community

FCO Foreign and Commonwealth Office, London

G-77 Group of 77

GATT General Agreement on Tariffs and Trade

GSP General System of Preference

HAEU Historical Archives of the European Communities, Florence

HAS Helmut-Schmidt-Archiv

IMF International Monetary Fund

MEP Member of Parliament

MFA Multi-Fibre Arrangement

MFN most-favoured-nation

NA National Archives, Kew

NATO (or OTAN) North Atlantic Treaty Organisation

NIEO New International Economic Order

OPEC Organisation of Petroleum Exporting Countries

PAAA Political Archives of the Auswärtiges Amt

PRC People’s Republic of China

SGCI Service Général de Coopération Interministérielle

UK United Kingdom

UN United Nations

UNCTAD United Nations Conference on Trade and Development

US United States

USSR Soviet Union

For the sake of convenience, 'Germany' refers to 'West Germany', and 'European' refers to 'Western European'.

Quotations are given in the language in which they figure in the relevant archive.

Introduction

In the turbulent decade of the 1970s, the relationship between the European

Community (EC) and the People’s Republic of China (PRC) went from non- existent to institutionalised, from symbolic to substantive. In September 1975 the PRC accredited an ambassador to the Community, in April 1978 both sides concluded a trade agreement, and in July 1979 a textile agreement followed. How and why did these changes occur? These are the central research questions of this thesis.

The Community’s opening to China required answers to the fundamental questions of what external relations issues the EC should tackle, how the Community should tackle them, and who should speak for the EC in international politics. The term ‘opening’ used in this thesis means the initial establishment of official political and commercial links. ‘External relations’ refers to the observation that the very existence of the EC as a political and economic entity had implications for the outside world. This existence generated – sometimes unintended – contacts and consequences which did not necessarily involve any consciously formulated overall policy.1 ‘Foreign policy’ means more specifically a purposeful activity: the formulation, implementation and evaluation of external choices usually within one country, viewed from that country. 2 ‘Foreign policy activity’ in the

Community is a process of integrating policies and actions of the member

1 Panayiotis Ifestos, European Political Cooperation: towards a Framework of Supranational Diplomacy?, (Avebury: Aldershot, 1987), p.6. 2 Ibid., referencing James Dougherty and Robert Pfaltzgraff, Contending Theories of Internaitonal Relations, (New York, Toronto: J.B. Lippincott Co., 1971).

13 states and the EC institutions towards the outside world. This activity is directed at non-members and international organisations and concerns political, economic, trade, and security-related issues. 3

Extending the Community’s foreign policy activity to Beijing entailed a furthering and deepening of European integration. ‘European integration’ refers to ‘the historical process whereby European nation-states have been willing to transfer, or more usually pool, their sovereign powers in a collective enterprise.’ 4 Although relations with China were not a priority for the

Europeans in the 1970s, analysing the origins of the Community’s relationship with Beijing is significant because it sheds light on the complex system of EC competences, institutions, and decision-making procedures related to its foreign policy activity in the Cold War era of détente. In order to answer the research questions and to shed light on the evolution of the

European Community as an independent political agent, this thesis analyses the EC’s opening to the PRC between 1969 and 1979.

In early 1975, following a series of secret meetings with the Chinese ambassador to Belgium Li Lianpi, Sir Christopher Soames, vice-president of the Commission responsible for external relations, accepted the invitation to visit Beijing in an official capacity. Only after a press leak did Soames announce to member state permanent representatives, en passant over a lunch in March, that he was to visit China in early May. As soon as he arrived in Beijing on 4 May 1975, Soames proposed to set up official relations in the

3 Roy H. Ginsberg, Foreign Policy Actions of the European Community: the Politics of Scale, (Boulder: Lynne Rienner, 1989), p.1. 4 Mark Gilbert, European Integration: a Concise History, (Lanham, Md: Rowman & Littlefield Publishers, 2012), p.1.

14 name of the Community, and then de facto sealed the deal. In an extraordinary coup de théâtre Soames confronted the member states with a fait accompli. Never before or since had a Commissioner taken such a bold initiative that guaranteed high visibility in a policy area which epitomises the sovereignty of the nation-state and the prerogative of the member states. And perhaps most surprising of all, Soames was successful.

Contemporary academic works on the relationship between the

European Union (EU) and China tend to focus on human rights, democracy, climate change, trade and investment. Study groups like the UACES

Collaborative Research Network on EU-China Relations and research centres like the Tsinghua-Groningen Centre for China-EU Studies mainly concentrate their attention to contemporary challenges. So does research on current EU diplomatic service by political scientists.5 In contrast, this thesis is a study of the origins of a diplomatic relationship which would subsequently grow in importance, and which has the potential to become yet more so in the decade ahead. The research sheds light on an earlier phase in the Beijing-

Brussels relationship very different from the post-Cold War period. This study therefore forms an essential base for a thorough examination of the

EU-China relationship in the 21st century. Considering the importance of the subject, it is remarkable that historians have given only limited attention to it. This is the first systematic historical study of the Community’s decision- making for opening to the PRC based on archival sources released according to the 30-year rule. It introduces the case of the EC-PRC relationship to the historiography of the European Union and the Cold War.

5 See for example: http://www.uaces.org/events/conferences/angers/papers/abstract.php?recordID=176.

Scope and approach

The three main research themes, which this thesis will make a contribution to, are the EC’s decision-making in foreign policy, European integration in the 1970s, and the intersection of European integration and the Cold War. To explain the beginnings of the EC’s relationship with the PRC and address these themes, the study defines its scope and approach in four main ways.

First, the research focuses on how the European Economic Community

(EEC), renamed EC after July 1967 merger treaty, dealt with Beijing. It does not look at the European Coal and Steel Community (ECSC) and the

European Atomic Energy Community (EURATOM) because these did not significantly affect the way the EC dealt with Beijing. Furthermore it concentrates on mainland China, and does not include the British colony of

Hong Kong. The EC dealt with Hong Kong separately from the PRC, in political and economic terms, and involves issues of decolonisation and bilateral Sino-British negotiations. It therefore offers material for a separate research project, but is beyond the scope of this thesis.6

Second, the study focuses on the period of 1969 to 1979. In 1969 the EC

Heads of State and Government decided at the Hague Summit to relaunch

European integration in terms of completion, widening and deepening.7 This

6 See the preferential tariff arrangements set out in the Council Regulation (EEC) No. 2762/72 of 19 December 1972; Council Regulation (EEC) No. 3054/74 of 2 December 1974; Council Regulation (EEC) No. 3010/75 of 17 November 1975; Council Regulation (EEC) No. 2706/77; separate textile agreement set out in Council Regulation (EEC) No 903/76 of 8 April 1976, Official Journal L 108, 26 April 1976; Yahuda Michael B., 'Hong Kong's Future: Sino-British Negotiations, Perceptions, Organization and Political Culture', International Affairs, 69, no. 2, 1993, 245–266; Hook Brian, 'National and International Interests in the Decolonisation of Hong Kong, 1946-97', in Judith M. Brown and Rosemary Foot (eds.), Hong Kong's Transitions, 1842-1997, (London: Macmillan Press, 1997). 7 Jan van der Harst (ed.), Beyond the Customs Union: the European Community’s Quest for Deepening, Widening and Completion, 1965-75, (Baden-Baden: Nomos, 2007).

16 relaunch coincided with the official end of the Cultural Revolution and a turn-around in Chinese foreign policy towards the EC, which Beijing now supported as a counterweight to the United States, and later also against the

Soviet Union.8 1979 is the date that the Community concluded the textile agreement with China. It thereby gave concrete substance to a relationship characterised so far more by political symbolism.

Third, as a study in international history this thesis adopts a

Community-centred approach.9 This approach allows it to address the main gap in the literature – namely an assessment of the importance of the internal, institutional dimension of Community politics in explaining the EC’s opening to China. It concentrates on how the different motivations of national and Community decision-makers played out within the EC institutions. The Community-centred approach makes it essential to conduct multi-lateral and multi-archival research, which is also the research agenda driving the field of ‘New’ Cold War History.10 This multilateral approach and these multi-archival sources enable new answers to be found and add significant value to the existing scholarship.

Whilst acknowledging that domestic politics are important in the conduct of foreign policy, a thorough investigation of their impact goes

8 Lirong Liu, 'The Evolution of China’s EU Policy: from Mao’s Intermediate Zone to a Strategic Partnership Based on Non-shared Values', Journal of European Integration History, 18, no. 1, 2012, 11–24; Findorff Barbara, 'China und die Europäsiche Gemeinschaft', Aussenpolitik, 23, no. 11, 1972, 656–662. 9 For further explanation of the approach, see: N. Piers Ludlow, The European Community and the Crises of the 1960s: Negotiating the Gaullist Challenge, (London, New York: Routledge, 2006), 7–10; For further examples, see: Ann-Christina L. Knudsen, Farmers on Welfare. The Making of Europe's Common Agricultural Policy, (Ithaca, New York: Cornell University Press, 2009); N. Piers Ludlow, 'The Making of the CAP: towards a Historical Analysis of the EU's First Major Policy', Contemporary European History, 14, 2005. 10 Odd Arne Westad (ed.), Reviewing the Cold War. Approaches, Interpretations, Theory, (London: Frank Cass, 2000), p.5.

17 beyond the scope of this thesis. However where a prominent effect is apparent, such as in the textile negotiations, the domestic dimension will be covered. Lastly, concerning the role of the member states, the research focuses on France, Germany and Britain. The first two are selected because they represented the two largest EC founding members. Without their consent any coordinated foreign policy activity towards China could not have been implemented. It includes Britain because, after its accession to the

Community in 1973, it added a different political and economic dimension to

European integration, not least due to its relations to the United States and the Commonwealth. Within this research framework, the role of other member states and of bilateral meetings between the national decision- makers and Beijing is also discussed, as is the impact of public opinion and interest groups, particularly the business community.

Literature review

This review of the literature highlights that neither the historiography of

European integration nor that of the Cold War have concerned themselves with the EC-PRC relationship. The few studies specifically dealing with the topic lack archival evidence, because most of them were published in the

1970s and 1980s, are from the disciplines of political science and law, and because their focus is predominantly on Chinese and Soviet policies. 11 When

11 For International Relations, see: David L. Shambaugh, Eberhard Sandschneider and Hong Zhou (eds.), China- Europe Relations: Perceptions, Policies and Prospects, (London, New York: Routledge, 2008); Natee Vichitsorasatra, 'The Evolution of Cooperation between the European Community and East Asia', Loughborough University, 2007; Reuben Wong, 'Forging Common EU Policies on China', in Gérard Bossuat and Anne Deighton (eds.), The EC/EU: a World Security Actor?, 70–93, (Paris: Soleb, 2006); Olaf Griese, 'EU-China Relations - an Assessment by the Communications of the European Union', Springer Verlag, 2006; David L. Shambaugh, 'China

18 it comes to the Community, these works stress either economic or geostrategic reasons to account for the opening. What is missing is a systematic assessment of the evolving institutional framework, the internal decision-making and the role of individual actors within the Community.

Such an evaluation is fundamental to understand the full dynamics of the EC-

PRC relationship. By addressing this deficiency, this thesis breaks new ground.

Boosting the Community’s foreign policy activity

To date the EC’s external relations are the subject of limited historical investigation. The main reason is the commonly-held view that the main actors in external relations were, and remain, the member states.12 Historians have acknowledged the Community’s role in recent studies relating to the

General Agreements on Tariffs and Trade (GATT), the developing countries,

and Europe', Annals of the American Academy of Political and Social Science, 519, 1992, 101–114; Putnam Mundy Ebinger, 'The Politics of Potential: the Relations of the People's Republic of China and the European Community and its Member-States France and Great Britain, 1969-1979', Tufts University, 1988; Harish Kapur, China and the European Economic Community: the New Connection, (Dordrecht: Martinus Nijhoff Publishers, 1986); Dick Wilson, 'China and the European Community', The China Quarterly, no. 56, 1973, 647–666; Giovanni Bressi, 'China and Western Europe', Asian Survey, 12, no. 10, 1972, 819–845; Barbara Findorff, 'China und die Europäsiche Gemeinschaft'. For Law, see: Francis Snyder, The European Union and China, 1949-2009: Basic Documents and Commentary, (Oregon: Oxford and Portland, 2009); Xiao Zhiyue, The European Community and China, (London: Butterworth, 1993). For History, see: Liu, 'The Evolution of China’s EU Policy'; Michael B. Yahuda., 'The Sino- European Encounter, Historical Influences on Contemporary Relations', in David L. Shambaugh, Eberhard Sandschneider and Hong Zhou (eds.), China-Europe Relations: Perceptions, Policies and Prospects, (London, New York: Routledge, 2008); Xiyu Chen, 'From Political Alliance in China's Conception to Comprehensive Partnership in Building: the Relations between China and the European Community/European Union', Eberhard-Karl Universität, 2003; J.Y.P Chang, 'The History of Diplomatic Relations between the Republic of China on Taiwan and the European Community and its Member States', Cambridge, 1997; John Redmond and Lan Zou, 'The European Community and China: New Horizons', Journal of Common Market Studies, XXV, no. 2, 1986. 12 Giuliano Garavini, 'Foreign Policy Beyond the Nation-State: Conceptualizing the External Dimension', in Wolfram Kaiser and Antonio Varsori (eds.), European History: Themes and Debates, (Basingstoke: Palgrave Macmillan, 2010), p.190.

19 the Communist bloc, and enlargement.13 But no comprehensive work exists that discusses the evolution of the Community’s decision-making in foreign policy and the effect this had on international relations. Generally, if historians attribute any foreign policy role at all to the EC they do so only in the second half of the 1980s under Jacques Delors’s Presidency of the

European Commission, when the Community approved the Single European

Act.14 The EC’s active response to China in the course of the period under review suggests that this view is misleading.

The essential questions this research deals with are who the drivers of the opening were, and what motivated them. Historians and political scientists agree that the EC reacted to the Chinese requests to establish formal political and commercial links, rather than having initiated them, and that the Chinese controlled the agenda. Whilst this thesis tests this claim on the basis of new evidence, it also explores in detail the role of the architects and motors within the Community in deciding how to deal with the PRC, i.e. the individual member states, the European Political Cooperation (EPC)

13 On GATT, see for example: Lucia Coppolaro, 'The European Economic Community in the GATT Negotiations of the Kennedy Round (1964-1967): Global and Regional Trade', in Antonio Varsori (ed.), Inside the European Community. Actors and Policies in the European Integration 1957-1972, (Baden-Baden, Bruxelles: Nomos, Bruylant, 2006). On the developing countries, see for example: Giuliano Garavini, 'The Colonies Strike Back. The Impact of the Third World on Western Europe, 1968-1975', Contemporary European History, 16, no. 3, 2007, 299– 319; Véronique Dimier and Mike McGeever, 'Diplomats Without a Flag: the Institutionalization of the Delegations of the Commission in African, Caribbean and Pacific Countries', Journal of Common Market Studies, 44, no. 3, 2006, 483–505; Marie-Thérèse Bitsch and Gérard Bossuat (eds.), L’Europe unie et l’Afrique, de l’idée d’Eurafrique à la convention de Lomé I, histoire d’une relation ambiguë, (Bruxelles: Bruylant, 2005). On the Communist bloc, see for example: Suvi Kansikas, 'Trade Blocs and the Cold War. The CMEA and the EC Challenge, 1969-1976', University of Helsinki, 2012; Angela Romano, 'A Single European Voice Can Speak Louder to the World. Rationales, Ways and Means of the EPC in the CSCE Experience', in Ann-Christina L. Knudsen et al. (eds.), The Road to a United Europe: Interpretations of the Process of European Integration, (Brussels: 2007). On enlargement, see for example: Furby Daniel Edwin, 'The Revival and Success of Britain's Second Application for Membership of the European Community, 1968-1971', Queen Mary, University of London, 2010; Karamouzi Eirini, Greece, the EEC and the Cold War 1974-1979, (Basingstoke: Palgrave Macmillan, forthcoming 2013). 14 Garavini, 'Foreign Policy Beyond the Nation-State: Conceptualizing the External Dimension', p.190–192.

20 mechanism, the European Council, the Council of Ministers, the Committee of Permanent Representatives (COREPER), the Commission, the European

Parliament (EP), individual Heads of States and Governments, and

Community officials. 15 No study so far has offered a conclusive evaluation on the basis of newly accessible archival records.

As regards the role of the member states, the existing literature on the foreign policy of the national governments neither investigates the role of

China in the respective European policies, nor investigates the Community dimension of their bilateral relations towards Beijing. 16 This study acknowledges that EC relations to the PRC were subordinated to national foreign policies. Until 1970, only two out of the then six member states had diplomatically recognised the People’s Republic: the Netherlands and

15 The following edited volume looks at the different actors within the Community: Varsori Antonio, Inside the European Community: Actors and Policies in the European Integration 1957-1972, (Baden-Baden, Bruxelles: Nomos, Bruylant, 2006). 16 On France, see for example: Laurent Cesari, 'Les relations franco-chinoises sous la présidence de Georges Pompidou (1969-1974)', in Laurent Cesari and Denis Varaschin (eds.), Les relations franco-chinoises au vingti me si cle et leurs antécédents, (Arras: rtois presses universit , 2003) Maurice a sse, 'Changement et continuité dans la politique européenne de la France', Paper presented at the Georges Pompidou et l’Europe: colloque, 25 et 26 novembre 1993, Paris 1993; Thierno Diallo, La politique étrang re de eorges ompidou, ol. 7 , (Paris: Librairie g n rale de droit et de jurisprudence, 1992); Samy Cohen, La monarchie nucléaire: les coulisses de la politique étrangère sous la Ve République, (Paris: Hachette, 1986); Samy Cohen and Marie-Claude Smouts (eds.), La politique extérieure de Valéry iscard d’Estaing, (Paris: Presses de la Fondation Nationale des Sciences Politiques, 1985). On Germany, see for example: Bernd Schaefer, 'Ostpolitik, "Fernostpolitik", and Sino-Soviet Rivalry: China and the Two Germanys', in Carole Fink and Bernd Schaefer (eds.), Ostpolitik, 1969-1974. European and Global Responses, 129-147, (New York: Cambridge University Press, 2009); Wilfried Loth, 'Deutsche Europapolitik von Helmut Schmidt bis Helmut Kohl', in Franz Knipping and Matthias Schönwald (eds.), Aufbruch zum Europa der zweiten Generation. Die europäische Einigung 1969-1984, (Trier: Wissenschaftlicher Verlag Trier, 2004); Helga Haftendorn, Deutsche Aussenpoliti ischen elbstbeschr n ung und elbstbehauptung 1945-2000, (Stuttgart Deutsche Verlags-Anstalt 2001); Kay Möller, 'Germany and China: a Continental Temptation', China Quarterly, no. 147, 1996, 706–725; Mechthild Leutner, Bundesrepublik Deutschland und China, 1949 bis 1995: Politik – Wirtschaft – Wissenschaft – Kultur: eine Quellensammlung, (Berlin: Akademie-Verlag, 1995). On Britain, see for example: David Gowland, Arthur Turner and Alex Wright, Britain and European Integration since 1945: on the Sidelines, (Abingdon: Routledge, 2010); James Ellison, 'Britain and Europe', in Paul Addison and Harriet Jones (eds.), A Companion to Contemporary Britain, (Oxford: Blackwell Publishing, 2005); John W. Young, Britain and European Unity, 1945-1999, 2nd ed, (Basingstoke: Macmillan, 2000); Robert Boardman, Britain and the eople’s Republic of China, 1949-74, (London, Basingstoke: Macmillan, 1976). For a comprehensive list see Bibliography.

France.17 Belgium, Luxembourg, Italy and Germany had been reluctant to establish official relations with the Chinese Communist government. The risk that this might strain their relationship with the United States and the Soviet

Union had proven too high.18 Only once almost all the member states had recognised the PRC could the EC engage in official relations with Beijing. Yet, a unique feature of the China case is that after 1969, when Mao Zedong officially declared the Cultural Revolution over, none of the member states had yet established significant political and economic links with the PRC.19

National governments and the Community bodies operated in uncertainty as to what to expect from the Chinese government. The People’s

Republic was just emerging from the Cultural Revolution. Launched by Mao in 1966, its official goal had been to remove capitalist, traditional and cultural elements from Chinese politics and society. 20 One of the most dramatic illustrations of the fight against capitalism, and symptoms of xenophobia, was the ousting of European diplomatic staff from China, and the burning of the chancellery building of the British legation in Beijing.21 Many have viewed the Cultural Revolution as lasting until the Chairman’s death in 1976. 22

Although in the early 1970s the Chinese government ended its self-imposed

17 Colin Mackerras and Amanda Yorke (eds.), The Cambridge Handbook of Contemporary China, (Cambridge: Cambridge University Press, 1991), pp.151–155. The dates of the establishment of diplomatic relations are: Netherlands (19/10/1954); France (27/01/1964); Italy (06/11/1970); Belgium (25/10/1971); Luxembourg (16/11/1972); FRG (11/10/1972) – member states from 1973 onwards: UK (06/01/1950); Denmark (11/05/1950); Ireland (22/06/1979). 18 See for example: Giovanni Bressi, 'China and Western Europe', Asian Survey, 12, no. 10, 1972, 819–845. 19 Erhard Louven, 'The European Community and Asia', in Robert H. Taylor (ed.), Asia and the Pacific, (Oxford: Facts On File Ltd., 1991), p.1231. 20 See for example: Jonathan Spence, The Search for Modern China, 2nd ed, (New York, London: W.W. Norton & Company, 1999). 21 Louven, 'The European Community and Asia', p.1231. 22 See for example: Rana Mitter, 'Review of Mao's Last Revolution', Reviews in History http://www.history.ac.uk, 2009.

22 ban on external trade and in 1972 agreed to mend fences with the United

States, its starkest ideological enemy, Mao’s guiding principle was to ‘rely mainly on our own efforts while making external assistance subsidiary’.23

Ideological campaigns continued. Some of them accentuated the political importance of autarchy and criticised imports from abroad such as the anti-

Confucius campaign of 197 . Only with Deng Xiaoping’s ‘Open Door Policy’ of 1978 did some of the unpredictability in Chinese politics and economics disappear.

Adding to this situation whereby the member states and the EC institutions all acted in the conditions of an institutional tabula rasa – a clean (or perhaps better erased) slate, none of member states had ever fully colonised China, in contrast to states in Africa and Southeast-Asia. Thus, in contrast to the relations with former colonies of the member states, the EC institutions were presented with a uniquely wide room for manoeuvre. The opening of China does therefore represent a fascinating, if unique, case study of how the member states and Community institutions competed for power and influence when establishing diplomatic and commercial relations with a major partner more or less from scratch.

Regarding the trade dimension in the EC’s foreign policy activity,

European firms doing business in countries outside the Community operated in the framework of the EC Common Commercial Policy.24 The Treaties of

Rome provided for procedures developing and putting this policy into effect.

23 Quoted in: Zhou Enlai, 'Report on the Work of the Government to the 4th NPC', 1975. 24 Churchill Archives Centre, Cambridge (henceforward CA), the papers of Baron Soames (henceforward SOAM) 42/1975 China, Record of a meeting between Sir Christopher Soames and the Chinese Vice Minister for Foreign Trade Mr. Yao I-Lin, Beijing, 7 May 1975.

The intention was that eventually the Community as such rather than the individual member states would sign and overview all trade agreements with third countries covering tariffs, quotas and the like. This meant the

Commission was to negotiate those agreements on behalf of the national governments. Yet the Community still had to work out the details for the

Common Commercial Policy towards the state-trading countries, the name used to designate the Communist countries. The existing literature is not clear how the EC developed its external commercial policy towards the PRC, and who was responsible for it.

s far as political issues in the EC’s foreign policy activity were concerned, the Treaties of Rome left the institutional responsibilities even more ill-defined and open to interpretation than for the Common

Commercial Policy.25 Elena Calandri goes so far as to argue that between 1958 and 1960 the Community’s decision-making in foreign policy was ‘sterilised’ because they revealed too many frictions and threatened the cohesion of the

Community.26 The Council of Ministers affirmed its primacy in this area.

Never could the Commission act on its own initiative on commercial and tariff agreements, accession and association agreements. Nor could it take action in the international economic organisations, on the Common

Commercial Policy, on legation rights or the representation of the

25 Gérard Bossuat and Anne Deighton (eds.), The EC/EU: a World Security Actor ?, (Paris: Soleb, 2007), p.11; Elena Calandri, 'La CEE et les relations extérieures 1958-1960', in Antonio Varsori (ed.), Inside the European Community. Actors and Policies in the European Integration 1957-1972, 399–432, (Baden-Baden, Bruxelles: Nomos, Bruylant, 2006); Piers N. Ludlow, 'The European Commission and the Rise of Coreper: a Controlled Experiment', in Wolfram Kaiser, Brigitte Leucht and Morten Rasmussen (eds.), The History of the European Union: Origins of a Trans- and Supranational Polity 1950-72, 189–205, (New York, London: Routledge, 2009), p.191. 26 Calandri, 'La CEE et les relations extérieures 1958-1960', p.431.

Community in external relations.27 COREPER developed as the institution which would keep the diplomatic ambitions of the Commission in check.28 Yet the Commission did claim general competence, not least in negotiating with third countries based on Article 228 of the Treaty of Rome.29

Specifically regarding China, Dick Wilson locates any foreign policy activity with the member states when he describes the Commission as ‘the permanent secretariat of the Community’ and the Council as the body ‘from which it takes policy instructions’.30 In contrast, Harish Kapur argues that the

Commission and Soames in particular took the lead.31 He also notes that the

European Council and the European Parliament expressed themselves in favour of opening relations with Beijing. But problematically, all accounts fall short of integrating the role of all the EC institutions involved, including the

EPC. This was a mechanism created in 1970 by which the member states coordinated their foreign policies.

More generally, an insight into the Commission’s role in the EC’s foreign policy activity is offered by Gérard Bossuat’s and na s Legendre’s chapter in Michel Dumoulin’s The European Commission, 1958-72.32 They argue that the Commission’s concern moved gradually from trade policy to economic policy and then to an explicitly political perspective. This study tests this claim. Choosing the case of China, it investigates how the

27 Ibid. 28 Ludlow, ‘The European Commission and the rise of Coreper’, p.191. 29 Calandri, ‘La CEE et les relations ext rieures’, p.422. 30 Wilson, 'China and the European Community'. 31 Kapur, China and the European Economic Community. 32 Gérard Bossuat and Anaïs Legendre, 'The Commission's Role in External Relations', in Michel Dumoulin, Marie- Thérèse Bitsch and European Commission (eds.), The European Commission, 1958-72: History and Memories, (Luxembourg: Office for Official Publications of the European Communities, 2007), pp.374–376.

Commission’s work fitted with the other players such as the Council of

Ministers. Pascaline Winand investigates specifically the Commission’s relationship with the United States, and Veronique Dimier focuses on the

Commission’s work in respect to the frican, Caribbean, and Pacific (ACP) countries. 33 Choosing the case of China, this thesis investigates how the

Commission’s work fitted with the other players such as the Council of

Ministers involved in devising the Community’s external relations.

Looking in general at the Commission’s interaction with the other institutions, a picture emerges whereby the member states more often than not side-lined the Commission. Piers Ludlow argues that in the 1960s, the

Commission failed to have a decisive impact on the resolution of political crises and that its leadership ambitions were much reduced.34 Similarly, Keith

Middlemas argues that European integration proceeded with an emphasis on inter-governmental supremacy, with most initiatives decided by the leading member states – a pattern of activity set in the 1960s.35 He concludes that the limited gains the Commission made, such as establishing its science and technology policy, its social action programme, the regional fund, and broadening political cooperation, all ‘came about primarily not because the

Commission initiated policy but because the Council of Ministers willed it.’36

In the same vein, historians have stressed the importance of the Franco-

33 Pascaline Winand, 'The Invention of EU Diplomacy: the European Commission Delegation in Washington D.C.: a 'Political Delegation' from the Fifties to the 21st century', in Gérard Bossuat and Anne Deighton (eds.), The EC/EU: a World Security Actor?, 94–115, (Paris: Soleb, 2006; Dimier Véronique, 'The Birth of a European Diplomatic Service: from Contrôleurs-techniques to the Delegates of the Commission in ACP Countries', in Gérard Bossuat and Anne Deighton (eds.), The EC/EU: a World Security Actor, 116–131, (Paris: Soleb, 2006). 34 Ludlow, The European Community and the Crises of the 1960, p.209. 35 Keith Middlemas, Orchestrating Europe. The Informal Politics of European Union, 1973-95, (London: Fontana, 1995), p.83 and p.90. 36 Ibid.

German tandem as a motor of European integration.37 This thesis investigates how far the case of China supports this picture.

Regarding the European Parliament the Treaties of Rome did not provide for it to behave as a national parliament at the Community level. It also struggled in its claim to represent the European citizens not least because until 1979 it was not directly elected.38 Since its creation however, the

EP had sought to raise its political profile and institutional standing.39 Only recently have historians begun to explore why the member states gradually endowed the European Parliament with supervisory, budgetary and legislative powers. 40 As regards decision-making in foreign policy, the

Treaties of Rome did not foresee any role for the EP. 41 Perhaps this was understandable because by its very nature, foreign policy activity requires secrecy, speed, coherence, efficiency, and in many national parliaments, the parliamentarians were not really involved either. So by the very definition of the policy-area at hand, an involvement of the European Parliament was not

37 See for example: Carine Germond, 'Le couple France-Allemagne et l'unification de l'Europe (1963-1969)', Université de Strasbourg, 2009; Claudia Hiepel, 'Willy Brandt, Georges Pompidou und Europa. Das deutsch- französische Tandem in den Jahren 1969-1974', in Franz Knipping and Matthias Schönwald (eds.), Aufbruch zum Europa der zweiten Generation. Die europäische Einigung 1969-1984, (Trier: Wissenschaftlicher Verlag Trier, 2004); Marie-Thérèse Bitsch and Christian Mestre, Le couple France-Allemagne et les institutions européennes: une postérité pour le plan Schuman ?, (Bruxelles: Bruylant, 2001). 38 See for example: Simon Hix, Abdul Noury and Gérard Roland, Democratic Politics in the European Parliament, (Cambridge: Cambridge University Press, 2007); Berthold Rittberger, Building Europe's Parliament. Democratic Representation Beyond the Nation-State, (Oxford: Oxford Universtiy Press, 2005); Juliet Lodge, Direct Elections to the European Parliament 1984, (Basingstoke: Macmillan, 1986). 39 Desmond Dinan, Ever Closer Union: an Introduction to European Integration, 3rd ed, (Basingstoke: Palgrave Macmillan, 2005), pp.259–280; Ludlow, The European Community and the Crises of the 1960s, p.1. 40 Emma De Angelis, 'The Political Discourse of the European Parliament, Enlargement, and the Construction of a European Identity', London School of Economics and Political Science, 2011; Aurélie Élisa Gfeller, Wilfried Loth and Matthias Schulz, 'Democratizing Europe, Reaching out to the Citizen? The Transforming Powers of the European Parliament', Journal of European Integration History, 17, no. 1, 2011; Rittberger, Building Europe's Parliament. 41 See for example: Gerhard Brunn, 'Das Europäische Parlament auf dem Weg zur ersten Direktwahl 1979', in Franz Knipping and Matthias Schönwald (eds.), Aufbruch zum Europa der zweiten Generation. Die europäische Einigung 1969-1984, (Trier: Wissenschaftlicher Verlag Trier, 2004).

27 expected, and therefore has found little, if any, attention in academic research.42 This research looks at the EP’s involvement in the EC’s opening to

China.

The EPC adds a further dimension to the analysis of the Community’s decision-making in foreign policy. Following the relaunch of European integration at the Hague Summit, the Six created the EPC in October 1970.43

The EPC was not, however, formally incorporated into the EC framework. It therefore added to the complexity and ambiguity of the issue of ‘who does what’ between the Commission and the Council of Ministers. 44 Daniel

Möckli’s study European Foreign Policy during the Cold War examines the

EPC which prior to that had mainly been analysed in the memoirs and testimonies of participants.45 Problematic in Möckli’s methodology is that he defines European foreign policy between 1969 to 1974 as the sum of national policies and EPC. Similarly, the approach by Maria Gainar in Aux origines de la diplomatie européenne – Les Neuf et la Coopération politique européenne de 1973 à 1980, published in 2012, implies that a European diplomacy is a nation-state affair. Adopting a statist interpretation, both pay minimal attention to and do not investigate further other players integral to European integration, such as the European Commission and the European Parliament,

42 Stephan Keukeleire and Jenniger MacNaughtan, The Foreign Policy of the European Union, (Basingstoke: Palgrave Macmillan, 2008), p.128. 43 See for example: Maria Gainar, Aux origines de la diplomatie européenne. Les Neuf et la Coopération politique européenne de 1973 à 1980, (Bruxelles: PIE Peter Lang, 2012), chapter 1; Daniel Möckli, European Foreign Policy during the Cold War: Heath, Brandt, Pompidou and the Dream of Political Unity, (London, New York: I.B. Tauris 2009), pp.184–247; Ifestos, European Political Cooperation. 44 Simon Nuttall, European Political Co-operation, (Oxford: Clarendon Press, 1992), p.1. 45 Möckli, European Foreign Policy during the Cold War; Elfriede Regelsberger, Phillippe de Schoutheete de Tervarent and Wolfgang Wessels (eds.), Foreign Policy of the European Union: from EPC to CFSP and Beyond, (Boulder, Colo: Lynne Rienner, 1997).

28 without which, as this study contends, the EC response to China, an act of

European diplomacy, cannot be understood.

The most important question of this thesis is why the Community as such opened up to China at the specific time and in the peculiar way that it did. An economic interpretation was advanced in the 1986 article by John

Redmond and Lan Zou, ‘The European Community and China: New

Horizons’ in Journal of Common Market Studies.46 Similarly, Xiyu Chen’s dissertation argues that ‘The pursuit of economic benefits has always been the primary goal for both’ China and the Community.47 In his introduction to the Journal of European Integration History issue on EU-China relations,

Jan van der Harst implies that economic and trade issues were dominant at the beginning. Only as ‘the relationship between the two blocs has become both comprehensive and diversified’ did the focus come to include politics.48

By contrast, the majority of works emphasise a political motivation including

Kapur’s pioneering monograph China and the European Economic

Community: the New Connection published in 1986. 49 Those works that focus on politics emphasise geopolitics to explain the EC-PRC relationship.

But all of them fail to analyse the internal Community politics involved in the

Community’s decision to open to China, and the unique constellation of individuals. Therefore an essential dimension to the ‘why’ question is

46 Redmond and Zou, 'The European Community and China'. 47 Chen, 'From Political Alliance in China's Conception to Comprehensive Partnership in Building', p.3. 48 Jan van der Harst, 'Introduction. The Evolution of EU-China relations', Journal of European Integration History, 18, no. 1, 2012, 5–10. 49 Yahuda, 'The Sino-European Encounter'; Chang, 'The History of Diplomatic Relations between the Republic of China on Taiwan and the European Community and its Member States'; Ebinger, 'The Politics of Potential'; Shambaugh, 'China and Europe'; Harish Kapur, Distant Neighbours: China and Europe, (London: Pinter, 1990); Wilson, 'China and the European Community'; Bressi, 'China and Western Europe'; Findorff, 'China und die Europäsiche Gemeinschaft'.

29 missing. With the opening of the archives, this research adds this internal dimension, and evaluates its importance.

A first step in answering the main research questions is to establish the chronology of events and the milestones - apart from the obvious ones of May

1975, April 1978 and July 1979. The questions that follow are on the decision- making process, the tactics that the Community adopted vis-à-vis China, and the tactics that mattered in intra-Community politics when it came to decide policy towards China. Answers to these in turn allow an assessment to be made as to whether the opening to the PRC was an incremental process, the result of a ‘spill-over’ effect, or down to conscious political decisions.50 Did a coherent EC China policy exist? This is the first study that deals comprehensively with these aspects.

European integration and the 1970s

The ‘bigger-picture’ question is whether the case of China supports the widely-held view of the 1970s as a decade of ‘Eurosclerosis’. Soames’ initiative came at a distinctive time in European history: ‘Europe has been confronted with a series of problems which have thrown the Community into a state of crisis’.51 Such were the words by Vice-President of the European

Commission Carlo Scarascia Mugozza speaking to the European Parliament on 12 February 1974. Europe had to grapple with global structural changes: superpower détente, the growing transatlantic rift, the global economic

50 Ernest Bernard Haas, The Uniting of Europe: Political, Social, and Economic Forces, 1950-1957, 2nd ed, (Stanford: Stanford University Press, 1968). 51 European Commission, Seventh General Report on the Activities of the European Communities in 1973, (Brussels: EEC, 1974), p.xv.

30 downturn marked by the break-down of the Bretton Woods system in 1971, the rise of the Organisation of Petroleum Exporting Countries (OPEC), the first oil shocks at the end of 1973, and the pressure for a New International

Economic Order (NIEO) by the developing states organized as the Group of

77.52 Following the ‘golden 60s’ began a decade of recession in Europe that led to protectionist tendencies and social unrest.53

The sense of disturbance continued. The annual General Report on the activities of the European Communities stated:

‘Early in 197 a crisis had developed in the Community. Economic and political difficulties had arisen in many areas, and the Community was not sufficiently equipped to cope with these properly. The year opened with reticence or refusal as regards the implementation of the policy guidelines emerging from the Paris and Copenhagen Summit Conferences. It was impossible to set up the European Regional Development Fund, there was hesitation over the transition to the second stage of economic and monetary union, and there was total disagreement on the policy to be followed in dealing with the energy crisis besetting the world and the Community. In place of endeavours to act for the common benefit by strictly applying the arrangements and procedures laid down in the Treaties, there emerged a trend towards inter-state cooperation based on the achievement of national interests.’54

52 See for example Niall Ferguson et al. (eds.), The Shock of the Global: the 1970s in Perspective, (Cambridge, Mass.: Belknap Press of Harvard University Press, 2010); Giuliano Garavini, 'The Conference for International Economic Cooperation. A Diplomatic Reaction to the Oil Shock (1975-1977)', Ann-Christina L. Knudsen and Morten Rasmussen (eds.), The Road to a United Europe. Interpretations of the Process of European Integration, 147–162, (Baden-Baden, Brussels: PIE, Peter Lang, 2009); ———, 'The Colonies Strike Back.'; Loukas Tsoukalis, The New European Economy Revisited, 3rd ed, (Oxford: Oxford University Press, 1997). 53 Nicholas Woodward, 'The Search for Economic Stability: Western Europe since 1973', in Max-Stephan Schulze (ed.), Western Europe, Economic and Social Change since 1945, 63–80, (London, New York: Longman, 1999), pp.63–79. 54 European Commission, Eighth General Report on the Activities of the European Communities in 1974, (Brussels: EEC, 1975).

And as the Community digested its first enlargement, all these challenges contributed to a ‘crisis of confidence, of will and of clarity of purpose’ in the

EC.55

A common narrative of the 1970s stresses institutional paralysis, the relative impotence of the European Parliament and the undermining of the

Commission by the member states and the EC intergovernmental institutions. 56 Middlemas terms the period ‘The Stagnant Decade’, and

Richard McAllister describes the mid-1970s as the 'locust years'. 57 Only recently has research questioned and revised this pessimistic view.58 The new picture is composed of the development of the European Court of Justice, the direct elections to the EP, the creation of the European Council, the negotiations with the African Caribbean and Pacific countries, the first and second enlargement, the setting up of the European Monetary System and transnationalization. With the 30-year rule now making archival-based studies possible, each of these developments have begun to generate more

55 'Declaration on the State of the Community’, European Commission, Bulletin of the European Communities, 17/1, 1974. 56 Bino Olivi, L'Europe difficile - histoire politique de l'intégration europénne, (Paris: Gallimard, 2001); Paul Graham Taylor, The Limits of European Integration, (London: Croom Helm, 1983); David Coombes ‘Concertation’ in the Nation-State and European Community', in Ghita Ionescu (ed.), Between Sovereignty and Integration, (New York: Wiley, 1974). 57 Middlemas, Orchestrating Europe; Richard McAllister, European Union. An Historical and Political Survey, (London: Routledge, 2010), chapters 5 and 6. 58 See for example: Gilbert, European Integration; Eric Bussière, Michel Dumoulin and Sylvain Schirmann, Milieux économiques et intégration européenne au XXe siècle: la relance des années quatre-vingts, 1979-1992 (Paris: Euroclio, 2007); Franz Knipping and Matthias Schönwald (eds.), Aufbruch zum Europa der zweiten Generation. Die europäische Einigung 1969-1984, (Trier: Wissenschaftlicher Verlag Trier, 2004); John Gillingham, European Integration, 1950-2003: Superstate or New Market Economy?, (Cambridge: Cambridge University Press, 2003). Richard Griffiths, 'A Dismal Decade? European Integration in the 1970s', in Desmond Dinan (ed.), Origins and Evolution of the European Union, 169–190, (Oxford: Oxford University Press, 2006); N. Piers Ludlow, 'From Deadlock to Dynamism: the European Community in the 1980s', in Desmond Dinan (ed.), Origins and Evolution of the European Union, 218–230, (Oxford: Oxford University Press, 2006).

32 detailed and substantive research which adds to the more nuanced picture.59

In this respect, the wider significance of the China case concerns the nature of

European integration: whether it only advances in times of economic prosperity, or whether it is in times of crisis that European politicians turn to

Europe in search of solutions.60

European integration and the Cold War

The Beijing-Brussels relationship did not flourish independently of the two superpowers and the Cold War. 61 This is the first academic work that investigates the impact of the Cold War on the internal decision-making of the Community in relation to China, and vice-versa – what impact the

Community’s opening to China had on the Cold War.62

The thesis develops the conclusions of recent scholarship on European integration history which detect the intersections with the Cold War. 63

Ludlow’s analysis on the EC institutions and the East-West conflict concludes that ‘Fighting the Cold War and integrating Western Europe remained two

59 See for example: Karamouzi, Greece, the EEC and the Cold War 1974-1979; Emmanuel Mourlon-Druol, A Europe Made of Money, (Ithaca, NY: Cornell University Press, 2012); Guia Migani and Antonio Varsori (eds.), Europe in the International Arena during the 1970s. Entering a Different World, (Brussels: Bruylant, 2011); Emmanuel Mourlon-Druol, 'Filling the EEC Leadership Vacuum? The Creation of the European Council', Cold War History, 2010. 60 N. Piers Ludlow, 'Governing Europe: Charting the Development of a Supranational Political System', in Wolfram Kaiser and Antonio Varsori (eds.), European History: Themes and Debates, (Basingstoke: Palgrave Macmillan, 2010). 61 See for example: Yahuda, 'The Sino-European Encounter'; David L. Shambaugh, China and Europe: 1949-1995, (London: SOAS-Contemporary China Institute, 1996); Kapur, China and the European Economic Community. 62 n exception is Marie Julie Chenard, 'Seeking D tente and Driving Integration: the European Community’s Opening towards the People’s Republic of China 1975-1978', Journal of European Integration History, 18, no. 1, 2012, 25–38. 63 N. Piers Ludlow, 'The New Cold War and the Expansion of the European Community – a Nexus?', Conference on European Integration ‘From Crisis to New Dynamics: The European Community 1973-1983’ ( arhus University, 2010; ——— (ed.), European Integration and the Cold War: Ostpolitik-Westpolitik, 1965-1973, (London, New York: Routledge, 2007).

33 distinct processes throughout the 1960s’.64 This research asks whether this also applies to the 1970s. It also tests Takeshi Yamamoto’s conclusion that after 1975 both Cold War history and European integration history evolved separately and in parallel, which contrasts ngela Romano’s argument. 65

Romano finds that the EC relations with the Soviet bloc grew more intense and diversified in the mid-1970s, therefore rendering the link between

European integration and Cold War history evident.66

Who mattered in the Cold War? This study contributes to the discussion on which actors were relevant in the East-West conflict. rne Westad’s monograph The Global Cold War: Third World Interventions and the

Making of Our Times has significantly shifted interpretations of the Cold

War which had so far been analysed primarily from the superpowers’ perspective.67 Westad concludes that developments in the developing world are essential to understand the evolution of the East-West conflict. The present research intends to add the role of the European Community – a distinctive political entity, which not least the PRC treated as such – and the new relationship between the EC and the PRC as factors of some importance to the Cold War. Building on Westad’s findings about Third World decision- making elites, this research inquires how individual actors within the

64 ———, 'An Insulated Community? The Community Institutions and the Cold War, 1965-1970', in N. Piers Ludlow (ed.), European Integration and the Cold War: Ostpolitik-Westpolitik, 1965-1973, (London, New York: Routledge, 2007). 65 Takeshi Yamamoto, 'Détente or Integration? EC Response to Soviet Policy Change towards the Common Market, 1970-75', Cold War History, 7, no. 1, 2007, 75–94. 66 Angela Romano, 'The Main Task of the European Political Cooperation: Fostering Détente in Europe', in Villaume Poul and Odd Arne Westad (eds.), Perforating the Iron Curtain - European Détente, Transatlantic Relations, and the Cold War, 1965-1985, (Copenhaguen: Museum Tuscunaum Press, 2010), p.136. 67 Odd Arne Westad, The Global Cold War: Third World Interventions and the Making of Our Times, (Cambridge; New York: Cambridge University Press, 2005).

Community instrumentalised the Cold War for their own power political interests.

The United States President Richard Nixon’s visit to Beijing in 1972 set essential conditions for the Western European governments’ willingness to normalise their relations with the PRC. 68 But the role the growing transatlantic rift played in the Community’s decision to establish official relations with China remains unclear, another gap in our knowledge which this thesis seeks to remedy. The EC-US relationship faced new strains mainly in the areas of economics, defence and diplomacy.69 As American Secretary of

State Henry Kissinger signposted in his speech on the ‘Year of Europe’ in

April 1973, the United States sought to define a new modus vivendi with the

Community. The speech had provocatively reduced the European allies to maintaining regional interests in contrast to America holding global responsibilities.70 This research explores whether the case of China supports political theorist Kenneth Waltz’ claim that the EC’s relations with the United

States were largely de-politicised; or whether it backs up historian Marc

Trachtenberg’s argument that European integration ‘was a way for the

68 See for example: Shambaugh, 'China and Europe'. 69 See for example: Gainar, Aux origines de la diplomatie européenne, chapter 2; Pascaline Winand, 'Loaded Words and Disputed Meanings: the Year of Europe Speech and its Genesis from an American Perspective', in Jan van der Harst (ed.), Beyond the Customs Union, (Brussels: Bruylant, 2007). 70 See for example: Gainar, Aux origines de la diplomatie européenne, chapter 2; Aurélie Élisa Gfeller, Building a European Identity: France, the United States, and the Oil Shocks, 1973-1974, (Berghahn Books, 2012); Möckli, European Foreign Policy during the Cold War; Jussi Hanhimäki, 'Searching for a Balance: the American Perspective', in N. Piers Ludlow (ed.), European Integration and the Cold War, 152–174, (London; New York: Routledge, 2007), pp.166–168.

Europeans to reclaim their political autonomy’.71

The relationship between the European Community and the Soviet

Union was at stake too. The contacts with China developed against the backdrop of the Sino-Soviet dispute. 72 What is more, it developed as the

Soviet Union refused to recognise the European Community.73 The Kremlin made every effort to liaise only with the individual member states and imposed on the East European socialist countries and the Council for Mutual

Economic Assistance (COMECON) a policy of non-recognition. 74 Moscow sought to control all relations by the East European countries with the

Community through COMECON.

In the late 1960s and early 1970s however the Soviet Union faced increased difficulties in controlling the East European states.75 The socialist countries turned increasingly to trade with the West because national economic reforms and intra-bloc trade proved ineffective.76 In parallel, the

Common Commercial Policy meant that the Commission was to be in charge of all the trade agreements. Therefore economic necessity led to individual

71 Marc Trachtenberg, Between Empire and Alliance: America and Europe during the Cold War, (Lanham, Md.: Rowman & Littlefield Publishers, 2003), p.viii; Kenneth Neal Waltz, Theory of International Politics, (Reading, Mass: Addison-Wesley Pub. Co, 1979). 72 Spence, The Search for Modern China, pp.553–559; Yamamoto, 'Détente or Integration?', 75–79; Yang Kuisong, 'The Sino-Soviet Border Clash of 1969: from Zhenbao Island to Sino-American Rapprochement', Cold War History, 1, no. 1, 2000, 25–27. 72 Kansikas, 'Trade Blocs and the Cold War'; Angela Romano, From Détente in Europe to European Détente: how the West Shaped the Helsinki CSCE, (Bruxelles: PIE Peter Lang, 2009); Yamamoto, 'Détente or Integration?. 73 Kansikas, 'Trade Blocs and the Cold War'; Romano, From Détente in Europe to European Détente, (Bruxelles: PIE Peter Lang, 2009); Yamamoto, 'Détente or Integration?. 74 Kansikas, 'Trade Blocs and the Cold War. The CMEA and the EC Challenge, 1969-1976', p.5. 75 Ibid., p.1 76 Ibid., p.213

Eastern European countries seeking to liaise with the Commission. 77

Romania for example had already developed informal contacts with the

Community; Hungary also sought to discard the official policy of non- recognition; Czechoslovakia and Poland circumvented COMECON rules to export agricultural and manufactured goods to the Community.78 Moreover, the first enlargement increased the political and economic weight of the

Community, which COMECON viewed with anxiety.79 This research clarifies on the one hand the extent to which the Community used the China card – meaning the extent to which the Europeans played up the Sino-Soviet rivalry to pressure the Soviet Union to recognise the competences of the EC. On the other hand, it will show whether and how the Community used the Soviet card vis-à-vis the Chinese.

The Community’s opening to China stood out as challenging the bipolar

Cold War order set by the superpowers. The dissertation investigates the usefulness of the ‘Third Force’ concept in explaining the Community’s opening to China. The ‘Third Force’ idea had different meanings at different times for different people. Prominent proponents included French President

Charles de Gaulle and British Foreign Secretary Ernest Bevin.80 Preceding the

Marshall Plan the idea applied to the role of Europe in international affairs and implied the aim to prevent the East-West confrontation.81 After 1947, the

77 Ibid., p.5. 78 Ibid. 79 Ibid., p.156. 80 See for example: Jeffrey G. Giauque, 'The United States and the Political Union of Western Europe, 1958-1963', Contemporary European History, 9, no. 1, 2000. 81 Wilfried Loth, 'Introduction', in Walter Lipgens and Wilfried Loth (eds.), Documents on the History of European Integration: The Struggle for European Union by Political Parties and Pressure Groups in Western European Countries 1945-1950, (Berlin: de Gruyter, 1988), pp.4–5.

37 concept evolved and rather meant for its European advocates to mediate between the East and the West and to prevent the US domination of Western

Europe.82

The EC-PRC relationship offers insights into the debate over the meaning of détente. Yet, the historiography on the Cold War remains silent on the EC-PRC axis. Interpretations of détente are marked on the one side by historians who stress that détente was never meant to end the Cold War.83

Notably, John Lewis Gaddis argues that détente reflected the common interests in Washington, Moscow, and the capitals of their allies in reversing the diminution of influence of the United States and the Soviet Union.84 On the other side are historians who distinguish a European from a superpower détente, and argue that it involved seeking a permanent solution to the conflict. 85 Jussi Hanhimäki for example concludes that European governments initiated and led European détente, best illustrated by the

Conference on Security and Cooperation in Europe (CSCE).86 But even this second side pays little attention to non-traditional actors like the Community, and individual institutions such as the Commission. Once more this thesis will seek to fill part of this gap.

82 Ibid, p.8. 83 See for example: John Lewis Gaddis, 'Grand Strategies in the Cold War', in Melvyn Leffler and Odd Arne Westad (eds.), The Cambridge History of the Cold War, (Cambridge: Cambridge University Press, 2009), p.23; Savranskaya Svetlana and William Taubman, 'Soviet Foreign Policy, 1962-1975', in Melvyn Leffler and Odd Arne Westad (eds.), The Cambridge History of the Cold War, (Cambridge: Cambridge University Press, 2009), p.20. 84 Gaddis, 'Grand Strategies in the Cold War', p.23. For a critique see for example: Geir Lundestad, 'The Cold War According to John Gaddis', Review of John Lewis Gaddis' 'The Cold War: A New History' (2005), Cold War History, 6, no. 4, 2006, 535–542. 85 Wilfried Loth, Overcoming the Cold War: a History of Détente, 1950-1991, (New York: Palgrave, 2001), p.viii; Richard Davy, 'Up the Learning Curve: An Overview', European Détente: Reappraisal, (London: Sage Publications, 1992). 86 Jussi Hanhimäki, 'Détente in Europe, 1962-1975', in Melvyn Leffler and Odd Arne Westad (eds.), The Cambridge History of the Cold War, (Cambridge: Cambridge University Press, 2009).

Sources

The multi-archival and multilateral approach adopted in this thesis means that this study draws on the records of the EC institutions (Commission,

Council of Ministers, European Parliament), the French, British and German governments, and a collection of personal papers, and interviews. To examine the interplay between national and Community level policy-making towards

China it is essential to explore the historical archives of the Commission, which also contain accounts of the COREPER’s workings, and of the meetings of the Council of Ministers in Brussels. Reading these helps to establish the collective Community decision-making vis-à-vis China post 1969. Of particular interest are the papers of Emile Noël, Secretary-General of the

Commission, and Emmanuele Gazzo, the Director of Agence Europe held in

Florence to provide an insight to the intricacy of the Brussels bureaucracy.

Soames’ papers held at the Churchill rchives Centre in Cambridge are important for documenting the pivotal role he played in the establishment of

EC-PRC diplomatic relations. Unfortunately, the papers are peculiarly sparse, which may be attributable to Soames having had dyslexia, meaning that he did not receive written briefs.87

The study also uses the European Parliament’s plenary sessions, reports, rules of procedures and the correspondence of the cabinet of

European Parliament President Emilio Colombo which are held at the Centre

Archivistique et Documentaire (CARDOC) in Luxembourg. These sources are valuable to find out the general discourse in which EC-China relations took

87 Daniel Edwin Furby and N. Piers Ludlow, 'Christopher Soames, 1968-72', in John Young and Rogelia Pastor- Castro (eds.), The Paris Embassy: British Ambassadors to the France, 1944-79, (forthcoming 2013).

39 place. Commission representatives were often more eloquent about their motivations when talking to the European Parliament than in their own internal deliberations, at least as the latter appear in the usually spare internal Commission records. These sources ought to be read with caution however since they might reflect more the way the Commission wanted to present an issue to the European Parliament, rather than the Commission’s internal deliberations. They also illustrate the pressure the European

Parliament exercised on the Council and Commission to improve relations with the PRC. Notably, Colombo was the first EP President to travel to China in 1979.

Not only is the consultation of the French, German and British national archives essential to extract member state interests in Community decision- making vis-à-vis China. They are also important to compensate for the patchy sources on COREPER and Council meetings. The official minutes kept in the

Council archives are very thin and of little use. The best approach to establishing what was discussed and decided in each meeting is to use the participants’ records of what went on as relayed back to the foreign ministries.

In France, the archives of the Quai d’Orsay at La Courneuve contain the files on French policy towards Europe and China. Since the Service Général de Coopération Interministérielle (SGCI) was the key institution for devising the French stance in Brussels from 1958 onwards the files held at the Centre des Archives Contemporaines (CAC) in Fontainebleau are relevant to extract the French decision-makers’ perceptions on the coordination of policies towards China in the name of the Community. The Ministry of Finance

40 archives at Savigny aid in the assessment of the economic determinant of

French attitudes towards a concerted EC response to China. This thesis also uses the files of Presidents Pompidou and Giscard d’Estaing, available at the

Archives Nationales in Paris.

In Germany, a reading of the Bundeskanzleramt files held at the

Bundesarchiv Koblenz is imperative to identify the top-level stance regarding the Community decision to adopt a stance towards China. Working down the administrative pyramid of the German government involves working through the files of the Bundesministerium für Wirtschaft also held in Koblenz, and the files at the Politisches Archiv des Auswärtigen Amt in Berlin. The latter contain the diplomatic correspondence and policy-papers of Germany and is essential for understanding the national decision-makers’ attitude towards a coordination of European foreign policies towards China. The personal papers of Helmut Schmidt in the Helmut-Schmidt-Archiv at the Archiv der

Sozialen Demokratie of the Friedrich Ebert Stiftung in Bonn are valuable in establishing the extent to which he contributed to the Community opening to

China.

Acknowledging that Britain joined the Community only in 1973, the investigation of the development of EC-China relations from the British government’s perspective concentrates upon the documentation held at the

National rchives in Kew. Consulting the Prime Minister’s (PREM), the

Cabinet papers (CAB), the files of the Foreign and Commonwealth Office

(FCO) and of the Treasury (T) , the project explores the perception of the

British government regarding coordinating their foreign policies towards

China with the other member states. The extensive reports from the

European capitals and Brussels contained in the files prove invaluable to gain an insight – even if biased – of the perceptions of and attitudes of the nine member states (the Nine) towards EC-PRC relations.

This thesis also draws upon interviews with actors involved in the beginnings of the EC–China relationship, and which have been conducted for the purpose of this study: Edmund Wellenstein, director general of the

Directorate of External Relations (DG I) of the European Commission (1973-

1976); David Hannay, Soames’ chef de cabinet (1973-1977); Louis Kawan, then principal adviser and task deputy to the CSCE in Europe and for relations with the state trading countries at DG I; John Maslen, adviser for

Relations with State Trading Countries at DG I in the period examined; David

Ting, then administrator at the Division for Relations with State Trading

Countries at DG I; and Théophile Junker, head of division at the EP

Directorate General of Committees and Interparliamentary Delegations

(1975-1992). In addition, the study uses the oral history section of the

Historical Archives of the European Union.

These oral sources come with all the pitfalls known to be inherent to their nature, including selective and altered memory, and the possibility of a person’s role being played up beyond what they actually did. However these sources offer a distinctive living link to the past. The eye-witness-accounts convey a different perception, authenticity, and feel for the time which the especially dry Community archival sources fail to communicate. Other sources available for this period are memoirs, political diaries and

42 biographies of the European decision-makers. 88 They provide insights into the intellectual and personal background of individuals and a human face to the 1970s. All in all, these additional, non-governmental sources shed light on the informal processes involved in decision-making, offering access to what took place behind-the-scenes.

Structure

The study is organised chronologically. Such an approach offers an overall picture of the landmarks and developments in the Community’s dealings with the PRC. It also allows an appreciation of the complexities and particularities of the time in which individual decision-makers operated. The chronological structure moreover conveys the variations in the atmosphere and tone, in the expectations and perceptions for the Community to engage with Beijing.

However within the chapters certain issues and actors are analysed thematically. This permits the details of a particular point to be brought together rather than having them spread out over periods of several months, with the purpose of showing more clearly their significance.

The opening chapter discusses how the contacts between the

Community and the PRC developed until December 1973, when the Nine pledged for the first time publicly to strengthen their ties with the People’s

Republic in the Declaration of European Identity. It examines how China

88 James Callaghan, Time and Chance, (London: Collins, 1987); Henri Froment-Meurice, Vu du quai, 1945-1983, (Paris: Fayard, 1998); Valéry Giscard d'Estaing, Le pouvoir et la vie. III., (Paris: Compagnie, 1996); Roy Jenkins, A Life at the Centre, (London: Macmillan, 1991); ———, European Diary, 1977-1981, (London: Collins, 1989); Jean François Poncet, Quai d'Orsay. Mémoires pour aujourd'hui et pour demain, (Paris: Odile Jacob, 2008); Helmut Schmidt, Menschen und Mächte. Die Deutschen und ihre Nachbarn, (Berlin: Siedler, 1990); ———, Weggefährten. Erinnerungen und Reflexionen, (München: Btb, 1998); Harold Wilson, Final Term: the Labour Government 1974- 1976, (London: Weidenfeld and Nicolson: Joseph, 1979).

43 featured in the Common Commercial Policy, and what the first attempts of political coordination towards Beijing were. It also analyses the impact of the first enlargement, and the beginning of the Sino-Soviet competition for closer contacts with the EC. The chapter shows that initially economics were the primary concern for the Community in its dealings with China. This changed to politics both regarding the Community’s position in the Cold War and concerning inter-institutional competences. It introduces the central role that

Soames came to play.

The decision to establish official relations with the PRC in May 1975 is the focus of Chapter Two. It traces back the extraordinary decision-making process, assesses the advantages implied in the setting up of formal relations with the People’s Republic, and explains the bureaucratic politics at work.

For the purpose of this thesis, the term ‘bureaucratic politics’ means the attempt by bureaucracies, whether governmental, intra-governmental, supranational or transnational, to manoeuvre themselves into strong positions in order to define the outcome of decision-making of the larger political entity they belong to.89 The chapter highlights the political nature of the decision, Soames’ distinctive part in the decision-making process, and the peculiar timing of the decision linked to the British referendum for EC membership, the first meeting of the European Council, and the culmination of the CSCE in Helsinki.

Chapter Three analyses the Community’s efforts between May 1975 and January 1977 to use the new momentum in its relationship with the PRC

89 See also: Ginsberg, Foreign Policy Actions of the European Community; Graham Allison and Philip Zelikow, Essence of Decision: The Cuban Missile Crisis, (New York: Longman, 1999).

44 government. It explains how the European Council involved itself in the new diplomatic relationship, and why the Commission’s efforts to speedily conclude a trade agreement with the Chinese were frustrated. The chapter reveals the effect of the qualitative jump in the EC-China relationship on the

Community’s dealings with the Soviet bloc, notably COMECON.

The conclusion of the EEC-PRC Trade Agreement is subject of Chapter

Four. The chapter argues that essentially politics more than economics continued to be at the forefront of the negotiations for an agreement. In the period up to 1980, the sixteen months between February 1977 and June 1978 were one of the most intense phases of interaction amongst the different

Community institutions. This interaction tended to be cooperative rather than antagonistic. Whereas the Chinese government was primarily the one that set the pace and timing for the conclusion of the trade agreement, it was the Commission which succeeded in negotiating an agreement largely in the

Community’s favour. Finally, the renewed intensification in the EC-PRC relationship paralleled that in the EC-COMECON one, and the Commission took advantage of this in the trade negotiations with the Chinese.

Chapter Five concentrates on the implementation of the trade agreement and the wider implications this had for the Community’s external relations. It looks at the Community’s visiting diplomacy, the role the private sector came to play in it, and the international crisis situation of the Sino-

Vietnamese war. It discusses the various economic instruments the

Community used, including the textile agreement, to smooth the political relations with Beijing. And it shows how the Cold War continued to be a defining external factor in shaping the relationship. However the economic

45 competition with the United States and Japan became an increasingly important one too. The final chapter draws together the different levels of analysis and provides concluding remarks.

Beginnings and a public pledge (December 1969 – December 1973)

‘La Chine multiplie les d clarations favorables à la Communauté européenne, mais celle-ci n'a jamais rien dit à propos de la Chine.’1

Etienne Manac’h, French ambassador to China, January 1973

‘Conscious of the major role played by China in international affairs, the Nine intend to intensify their relations with the Chinese Government and to promote exchanges in various fields as well as contacts between European and Chinese leaders.’2

Declaration of European Identity, December 1973

The Nine pledged for the first time publicly their concerted effort to intensify relations with China in the Declaration of European Identity of 14 December

1973. 3 Such a pledge was remarkable. Until recently, the majority of

European governments had not wanted to deal with Mao’s People’s Republic.

But now, not only did the Nine reach out diplomatically to Beijing, but they also used the relationship to demonstrate West European unity in international politics. Historians such as McAllister depict 1973 as a

‘traumatic year’ for the EC which left a legacy that was ‘not a happy one’.4

Enlargement resulted in the Community being ‘wider but weaker’. 5 This

1 Archives du Ministère des Affaires Etrangères, La Courneuve (henceforward AMAE), Série Service de Coopération Economique (henceforward DE-CE), 1967-1975, 1070, La Chine et la Communauté européenne, Manac'h to Schumann, Beijing, 17 January 1973. 2 Declaration of European Identity, in European Commission, Bulletin of the European Communities, 12/12, 1973, pp.118–122. 3 Ibid. 4 McAllister, European Union, p.81. 5 Ibid, pp.70–1.

47 chapter challenges these views. It shows that in important respects it was in

1973 that the Community set the political groundwork for its relationship with Beijing. Regarding the China dossier the ‘wider and stronger’ thesis proves more adequate.

The purpose of this chapter is to analyse how the European Community engaged with the PRC until December 1973. The chapter confirms that US

President Richard Nixon’s 1972 visit to Beijing was an essential factor in allowing the Community as such to liaise with Beijing. It also backs the prevalent view that the relationship developed mainly because the Chinese government sought more contacts whereas the Europeans reacted to this.6 It adds however that in the Community the China issue rose in salience as the result of a bottom-up process rather than a top-down one. It demonstrates that the European Parliament was the one EC institution which from the beginning pushed for a concerted Community approach. Only when Britain joined the EC in January 1973 did the member states involve themselves more. The Commission took an active interest in the China dossier once Sir

Christopher Soames became vice-president responsible for external relations.

Establishing official relations with the Community became his personal ambition – what the Americans had done in 1972, he wanted to do in the name of the Community. Whereas initially the primary concern in the

Community’s dealings with Beijing was economics, by 1973 this had changed to politics.

6 See for example: Ebinger, 'The Politics of Potential'; Kapur, China and the European Economic Community.

First, this chapter analyses the relevance of the PRC in the evolution of the EC Common Commercial Policy. Second, it examines the first steps of

European diplomacy vis-à-vis China. The focus is on the vote on the PRC’s permanent seat at the United Nations (UN) Security Council, and the first contacts between the Chinese and the Commission. Third, the chapter looks at the effects of enlargement on the way the Community responded to the

PRC. It then analyses how the political contacts intensified and the Nine arrived at the definition of a political consensus on China. Next, the chapter investigates the consequences of the EC-PRC rapprochement for the

Community’s relationship with the Soviet bloc. Finally, the chapter examines the reference to the PRC in the Declaration of European Identity.

Institutionalising trade

The policy area where the Community faced the task of defining how to deal with China for the first time in EC history was the Common Commercial

Policy. The trade articles that the Europeans were interested in exporting to

China included multiple high technology products, power plants, transport and communication equipment, tankers and special ships, electronics, food processing machinery, manufactured goods, chemical produce such as pesticides and fertilisers, but also agricultural produce like grain and cereals.7

The goods which the Europeans were keen on importing from the PRC

7 Council of Ministers Archive, Brussels, (henceforward CMA), Historical Archive, CM2, CEE CEA 2026/1974, Rapport des Conseillers Commerciaux (2ème Rapport), 26 March 1974; CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974; European Commission Historical Archives, Brussels (henceforward ECHA), BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (4ème rapport), 3 April 1975.

49 included natural resources such as coal, iron ore, manganese, oil, uranium, bauxite, tin, tungsten, and antimony.8 Thus the EC and the PRC economies potentially complemented each other. But after the break down of external trade during the Cultural Revolution, China remained to the Europeans an unknown entity as a market, and the factors that influenced its economy remained obscure to them too.9

A first landmark in the institutional wrangle of how the Community should figure out its policy towards the PRC came in March 1965. The

Commission sought to oblige member states to seek approval for agricultural trade deals with all state trading countries. France in particular protested against this decision, partially because it had just struck a significant trade deal for grain sales to China.10 But the Commission argued that it had the right to get involved because under the rules of the Common Agricultural

Policy (CAP), EC funds were to subsidise agricultural exports. Therefore the

French decision had consequences that reached beyond France and China.

The outcome was that the Council of Ministers overruled the Commission.11

The Council of Ministers decided the next stage in how to deal with the state trading countries, when it adopted three regulations to standardise the import regimes in 1968.12 During the consultation between the Council of

8 John Robinson, EC-China Trade Trends, (Brussels: EEC, 1975). 9 See the reports from China: ECHA, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (4ème rapport), 3 April 1975. 10 Ludlow, The European Community and the Crises of the 1960s, p.67. 11 Financement de la politique agricole commune. Ressources propre de la Communaute. Renforcement des pouvoirs du Parlement européen. Propositions de la Commission au Conseil. COM (65) 150 final, 31 March 1965. 12 EEC Regulation n° 2041/68, 2043/68, 2045/68 of 10 December 1968, Official Journal L 303, 18 December 1968.

Ministers and the Commission the European Parliament requested the

Commission to account for its activities.13 Similar to the dispute in 1965, the

Member of Parliament (MEPs) made their voice heard.14 Again, it took two inquiries including a complaint by Hendrikus Vredeling, an MEP from the

Dutch Labour Party, for the Commission to elaborate an answer. 15 The pattern whereby the European Parliament elbowed its way into the

Community’s decision-making was already emerging at this early stage.

The Council of Ministers decision of 16 December 1969 on the commercial agreements with all third parties refined matters further.16 The

Commission was to negotiate all commercial agreements with third countries in the name of the Community. The decision also contained transitional measures. These addressed the problem that originated from the fact that the

Community did not have official relations with the Communist countries. The measures foresaw that until 31 December 1972 the member states could negotiate agreements as long as they did not contradict the EC guidelines.

From 1 January 1973 onwards the Commission was to take over, and any existing bilateral trade agreements were to terminate on 31 December 1974.

The Sino-German trade agreement shows how from 1969 onwards the national governments coordinated their external trade relations with each other and the Commission. German Chancellor Willy Brandt’s government recognised the PRC diplomatically on 11 October 1972. By that date a Sino-

13 Written Question No. 140/69, de M. Vredeling à la Commission des Communautés europénnes, Official Journal C 112, 28 August 1969. 14 Written Question No. 18/65, de M. Vredeling à la Commission des Communautés europénnes, Official Journal C 127, 13 July 1965. 15 EEC Regulation n° 2041/68, 2043/68, 2045/68 of 10 December 1968, Official Journal L 303, 18 December 1968. 16 Official Journal L 236, 29 December 1969.

German rapprochement proved less liable to upset either the United States or the Soviet Union. Nixon had travelled to China and Brandt had cemented his

Ostpolitik via the Moscow Treaty, the Warsaw Treaty, the Four Power Treaty on Berlin, and the preparations of the Basic Treaty.17 Prior to official relations the chambers of commerce arranged the trade regulations.18 Now German

Foreign Minister Walter Scheel discussed the options for a trade agreement.19

The Chinese asserted they were not yet ready for a Community agreement.

Therefore Germany asked prior to the opening of bilateral negotiations for an

EC ‘consultation-coordination’ procedure based on the Council decision of

December 1969.

The consultations began on 23 October 1972 at the Permanent

Representative’s Committee (COREPER) working group which dealt with the state trading countries. Such working groups were staffed by national experts or from the member states' Permanent Representations and by a Commission representative. Although they did not have the authority to take decisions, they completed the bulk of the work. They exchanged views, ensured mutual consultation, furthered cooperation between specialized national diplomats, and identified options for consideration and decisions at a higher level.20 As a result of the consultation, the German government asked the Commission to approve its project. Carlo Scarascia Mugnozza, vice-president of the

Commission, did so on 8 November 1972. The Council subsequently accepted

17 Keukeleire and MacNaughtan, The Foreign Policy of the European Union, p.75. 18 ECHA, BAC 48/198/4441, Consultation-coordination préalable à l'ouverture des négociations entre l'Allemagne et le République populaire de Chine pour la conclusion d'un accord commercial à long terme, Ernst to Dahrendorf, Brussels, 26 October 1972. 19 National Archives, Kew (henceforward NA), FCO 30/1287, Eastern Area Group, de Fonblanque to Gaving, Brussels, 24 October 1972. 20 Keukeleire and MacNaughtan, The Foreign Policy of the European Union, p.75.

52 the Commission’s proposal. This allowed Germany to conclude a trade agreement valid between 1972 and 1974.21 This episode illustrates how the

Community dimension in the member states’ foreign trade policy with China had become an integrated part of the process.

The Council decision of December 1969 also regulated the EC’s autonomous commercial measures. This meant a Community scheme of liberation measures for products under quotas. Member states could still request special national quotas subject to approval from the Council of

Ministers. Examples of such requests concerned for example dehydrated garlic, green beans in tins, and silk.22 The Community classified the PRC in the list of state trading countries. This implied higher quantitative restrictions on Chinese imports to the EC than if China had featured amongst the developing countries.

As the EC-PRC trade developed the European Parliament advocated closer coordination between the member states. It pushed the Council of

Ministers to account for the effectiveness of the Common Commercial Policy.

Cornelius Berkhouwer, Dutch MEP of the Liberal and Democratic Group and president of the European Parliament from 1973 to 1975, addressed the

Council in August 1971:

21 ECHA, BAC 136/1987/624, Economic notes on trade with China, Soames cabinet, Brussels, 14 February 1973. 22 ECHA, BAC 136/1987/625, Recours à l'article 115 du Traité introduit par la France le 5 juillet 1973 pour l'ail deshydraté (position 07.04 ex B du TDC) originaires de la République populaire de Chine et mis en libre pratique dans les autres Etats Membres, Wellenstein to Soames, Brussels, 18 July 1973; ECHA, BAC 136/1987/625, Recours à l'article 115 introduit le 10 avril 1973 par l'Allemagne relatif aux préparations et conserves de haricots verts (position 20.02 ex G du TDC) originaires de Républiques populaire de Chine et mises en libre pratique dans les autres Etats Membres, Wellenstein to Soames, Brussels, 13 April 1973; ECHA, BAC 136/1987/626, Recours à l'article 115 du Traité introduit par l'Italie le 14 mai 1973 pour exclure du traitement communautaire les tissus de soie grège (position ex 50.09 du TDC), originaires de République populaire de Chine et mis en libre pratique dans les autres Etats Membres, Meynell to Soames, Brussels, 21 May 1973.

‘In the light of the developing economic relations between the EEC and the People’s Republic of China, should the Council not set out a Common Commercial Policy to avoid that China can play off the member states against each other?’23

The European Parliament was to continue its pressure in that respect. In

June 1973 it inquired this time whether the Commission had elaborated a global approach for EC trade relations with China.24

Such a query hit a nerve. The commercial rivalry between the member states in China was growing, as the British pointed out once they joined the

Community.25 Even if the Chinese welcomed the EC collective policy towards the Soviet Union and others, they preferred themselves to negotiate with the member states individually. Consequently the member states competed for

Chinese favours against one another.26 The European Parliament’ enquiries acted as an uncomfortable reminder of how the member states were depriving the Community of any collective bargaining power.

One attempt to shore up such European bargaining power developed when the member states’ commercial and economic representatives in

Beijing met in July 1972. At a lunch meeting on 26 July 1972 the representatives decided on closer cooperation amongst the Europeans in

China. The Dutch representative took the Chair by virtue of his country’s chairmanship of the Council of Ministers. Belgium, France, Italy, Denmark and Norway were also represented at this first meeting. Germany,

23 ECHA, BAC 71/2004/92, Written Question No. 243/71, Mr. Berkhouwer to the Council of Ministers, 10 August 1971. 24 ECHA, BAC 71/2004/92, Written Question No. 152/73, Mr. Cousté to the Commission of the European Communities, 18 June 1973. 25 NA, FCO 40/460, The external relations of the European Community: relations with non-European Communist countries, 22 March 1973. 26 Ibid.

Luxembourg and Ireland did not join because they had not yet established diplomatic relations. The representatives agreed to gather monthly, to have a greater exchange of information, and to report every six months on the economic and commercial situation in China to the Council of Ministers and the Commission.27

But despite the significant development of the policy framework, the

EC-PRC trade itself grew only slowly and proved almost negligible in quantitative terms.

Table 0-1: Direction of trade of the Six for 1965 and 1971 in million US $28

Exports of the Six to 1965 1971

the PRC 231 336

Hungary 156 441

Sweden 1594 2297

the United States 3425 7753

Imports by the Six 1965 1971 from

the PRC 195 282

Hungary 160 364

Sweden 1298 2136

United States 5692 9053

27 NA, FCO 219/79, Hum to Crompton, Beijing, 1 August 1972. 28 International Monetary Fund (2006): Direction of Trade Statistics (Edition: 1948-1980). ESDS International, University of Manchester.

For 1971 the Commission noted that the trade did not develop in a satisfactory manner. 29 The exports of the Nine regressed from US$ 461 million in 1970 to US$ 397 million (-14%), whereas the imports of all other countries to China saw a global increase of 1% (an increase of US$ 2120 to

US$ 2148 million). As far as the imports by the Nine from China were concerned, the level of 1970 remained (US$ 347 million), but the imports of all the trade partners of China taken together progressed in 1971 by approximately 13% (from US$ 2052 to US$ 2318 million). Taking as a base the year 1965, the Nine’s exports to China increased until 1971 by 30% and the imports from China by 20%. In this light the growth in exchanges of

China was significantly lower than the growth of exchanges in goods between the Community and the Eastern European countries. 30 Therefore despite further coordination and institutionalisation of trade relations, the evolution of EC-PRC trade proved disappointing and the relative volume of trade almost insignificant.

First political coordination

French President Georges Pompidou denied that a common foreign policy towards the PRC existed in the first place. He commented to Henri Froment-

Meurice, director for sia at the Quai d’Orsay, on his travel account to China of 9 February 1971: ‘Il n'y a pas, pour le moment, de politique trangère des

Six et nous ne faisons que nous compromettre vis-à-vis de tout le monde en

29 ECHA BAC 136/1987/624, Le Commerce extérieur de la Chine: structure et perspectives de développement, Brussels, 23 February 1973. 30 Ibid.

56 faisant quelques efforts dans ce sens.’31 But a coordination of the member states’ foreign policy became topical only a few months later when they faced the vote on the PRC’s role at the United Nations.

The member states discussed the vote within the European Political

Cooperation (EPC) mechanism and bilaterally rather than through

COREPER or the Council of Ministers. 32 In the late 1960s the PRC had started to lobby intensively to win the seat in the United Nations and the accompanying permanent membership of the Security Council vote. The

Guomindang government on Taiwan had held that membership since 1949.33

In October 1971 the UN General Assembly voted on a motion sponsored by the United States that would have allowed Taiwan to keep its seat.34 But the vote turned out in favour of the PRC.35 The PRC managed a further step in consolidating its status as a world power following the acquisition of a nuclear capability in 1964. For the first time the European delegations departed from their former alignment with the United States on the China question and did not support American resolution to keep a seat for Taiwan

31 Archives Nationales, Paris (henceforward AN), Papers of Georges Pompidou (henceforward 5 AG 2), 1035, Note manuscrite de Monsieur Pompidou sur la note de M. Froment-Meurice: conclusion d'un voyage en Chine et dans le Sud-Est asiatique, 9 February 1971. 32 For examples of meetings at bilateral level see: AN, 5 AG 2, 108, Conversations franco-britanniques sur l'Asie, 4-5 mars 1971, 10 March 197; AN, 5 AG 2, 108, Conversations franco-britanniques des 22 et 23 octobre 1970 à Paris, 4 November 1970; examples of EPC meetings: Politisches Archiv des Auswärtigen Amt (henceforward PAAA), B21/744, Europäische politische Einigung, Sitzung Politisches Komitee vom 20./21. September 1971 in Rom, Staden, 24 September 1971. 33 Spence, The Search for Modern China, pp.596–598. 34 United Nations General Assembly, 26th session, Annexes, Agenda item 93, Doc. A/8392. 35 adopted Resolution 2758 (XXVI) in favour of the PRC.

57 in the UN.36 All voted in favour of the resolution except Luxembourg which abstained.37

But it was the European Parliament that turned the UN vote on the PRC into a Community affair. Berkhouwer confronted the Council of Ministers on

26 August 1971 with the question of whether it coordinated a stance on the

PRC.38 In order to increase the pressure on the Council to reply, Belgian MEP

Ernest Glinne, from the Socialist Group, put a similar question to the Council of Ministers.39 In both cases the member states deflected accountability: they answered that the matter was for EPC to deal with and not within the competence of the Council of Ministers.

The EC-PRC relationship took on a new quality in May 1972 because

Zhou Enlai, prime minister and foreign minister of the People’s Republic, mentioned in an interview to Agence France Press the possibility of accrediting a diplomatic mission to the Community.40 A moderate Chinese foreign policy line emerged with Zhou Enlai’s ascendancy in the context of heavy factional infighting as Mao sought to reassert the authority of the party

36 Ebinger, 'The Politics of Potential', p.832. See also on the German position: Bundesarchiv, Koblenz (henceforward BAK), Files of the Bundeskanzleramt (henceforward BKA), B136/6244, Minister and Herrn AL II, 28 October 1971; BAK, BKA, B136/6244, Aufnahme der VR China in die Vereinten Nationen, Sanne to Schönefeld, Bonn, 3 November 1971; BAK, BKA, B136/6244, Aussenpolitische Unterrichtung des Kabinetts, Punkt 4 der Tagesordnung der Kabinettssitzung am 10. November 1971, Vertretung Chinas in den Vereinten Nationen, Heimsoeth an Referat L 1 im Hause, Bonn, 8 November 1971. 37 http://unbisnet.un.org:8080/ipac20/ipac.jsp?profile=voting&index=.VM&term=ares2758 38 Written Question No. 243/71, de M. Berkhouwer au Conseil des Communautés europénnes, Politique commune à l'égard de la République populaire de Chine, Official Journal C 5, 21 January 1972. 39 see ECHA, BAC 71/2004/92; Written Question No. 261/71, de M. Glinne au Conseil des Communautés europénnes, 26 August 1971, Représentation de la République populaire de Chine à l'ONU, Official Journal C 5, 21 January 1972. 40 ECHA, BAC 48/1984/687, Information relation extérieures, La République populair de Chine et la Communuté européenne, undated.

58 over the military.41 From autumn 1972 onwards the Chinese approached the member states via their foreign ministries in the national capitals, via their representation to Belgium in Brussels and their embassies in Beijing. They also struck up contact with Community officials via international organisations, at the Commission in Brussels, and finally they approached

Soames directly in London. The Chinese sought information on the legal aspects of establishing official relations with the EC. They also inquired about

Community policies which did not link directly to the PRC-Europe relationship. This included developments related to the economic and monetary union, enlargement, and relations with the United States, the

Soviet Union and the developing countries. Consequently the Europeans did not only discuss the EC-PRC relations in theoretical terms and amongst themselves anymore, but they also faced the task of defining the Community relationship in direct dialogue with the Chinese themselves.

The next milestone in the EC-PRC relationship occurred on 4 December

1972 when two Chinese representatives visited the Commission in Brussels for the first time. The approach was not entirely unexpected. In October at a session of the United Nations Conference for Trade and Development

(UNCTAD) in Geneva the Chinese representative Chang Tianhua had suggested such a visit to a Community official.42 In December, it was Hsieh

Chen-Li, third secretary of the embassy of the PRC to Belgium, and his interpreter, who first had a meeting with the Commission’s Service

Documentations. Then Louis Kawan, principal adviser and task deputy to the

41 Ebinger, 'The Politics of Potential', p.26. 42 AMAE, Série DE-CE, 1967-1975, 1070, CEE-Chine, Ministère d'état chargé de la défense nationale, SDECE, 14 November 1972.

CSCE in Europe and for relations with the state trading countries at DG I, met the Chinese.43 Exchanges picked up with a second visit following on 26

January 1973 and a third one on 5 February 1973.44

The first manifestation of a concerted and distinctive European approach vis-à-vis China was in the making. The member states had coordinated their UN vote in favour of the PRC and against American policy.

Whereas this coordination took place at EPC, the European Parliament did its utmost to turn the issue into a Community one. Once Zhou Enlai publicly expressed interest in official EC-PRC relations in May 1972, the first direct political contacts between the Chinese and the Commission in Brussels followed. These contacts enabled the Commission to assume a more active role in the wake of the first enlargement.

Fresh impetus due to Britain joining

A concerted Community response to China became even more complex when

Britain, Ireland and Denmark joined the EC in January 1973. One motivation for Britain to join the Community was to give more weight to the British role in international affairs.45 Prior to joining the Community, the British had already fostered contacts with the Chinese on Community matters. Michael

Butler, the head of European Integration Department at the Foreign and

Commonwealth Office (FCO), had given the Chinese ambassador in London a

43 ECHA, BAC 136/1987/838, Visite de diplomates chinois, DG I to Dahrendorf, Brussels, 4 December 1972. 44 ECHA, BAC 136/1987/838, Chine-Communauté, 2ème visite de diplomate chinois, Wellenstein to Soames, Brussels, 26 January 1973; ECHA, BAC 136/1987/838, Chine, Wellenstein to Soames, Brussels, 5 February 1973. 45 Refer for example to: Giulia Bentivoglio, 'Britain, the EEC and the Special Relationship during the Heath Government', in Michel Affinito, Guia Migani and Christian Wenkel (eds.), Les Deux Europes the Two Europes: Actes du IIIe Colloque International RICHIE Proceedings of the 3rd International RICHIE Conference, (Brussels: PIE Peter Lang, 2009), pp.284–285.

60 full account of the Paris Summit of October 1972.46 Moreover, on 31 October

1972 the FCO Permanent Under-Secretary Thomas Brimelow had agreed with the Chinese Assistant-Minister Zhang Wenjin to inform the Chinese about European developments.47 Later, on 28 November 1972, Roger Hervey, an FCO official, wrote to Richard Evans, FCO head of the Far East

Department, and Martin Morland, FCO assistant head at the European

Integration Department, that one of the interpreters at the Chinese embassy had enquired which countries proposed to accredit representatives to the

Commission. Hervey commented that ‘This may an important straw in the wind. The Chinese enquiry suggests prima facie that Peking may be considering more actively than hitherto accrediting a representative to the

EEC.’ 48 Similar queries followed in December. 49 Thus in the run-up of

Britain’s EC membership, the FCO already promoted the EC-PRC relationship bilaterally.

Britain fostered the EC-PRC relationship also working through the EPC.

Britain was eager to exploit the opportunities of this new mechanism. It had joined the Political Committee in February 1972, and the British constantly advocated a ‘Europe able to speak with one voice’.50 Considering the growing number in Chinese queries about official relations with the Community and the prospect of Deng Xiaoping’s visit to Europe in early 1973, the British

46 NA, FCO 30/1281, Chinese interest in European developments, Davies to Samuel, London, 6 December 1972. 47 NA, FCO 30/1282, Record of conversation at the Chinese embassy at 2.30pm on 27 October, 1972; NA, FCO 30/1282, Chinese interest in European developments, Davies to Samuel, London, 6 December 1972. 48 NA, FCO 30/1282, China and the EEC, Hervey to Evans and Morland, 28 November 1972. 49 NA, FCO 30/1282, China and the EEC, 15 December 1972. 50 Romano, 'The Main Task of the European Political Cooperation, footnote 126; Giulia, 'Britain, the EEC and the Special Relationship during the Heath Government', p.283.

61 pushed for closer European cooperation.51 The Permanent Undersecretary’s

Planning Committee pointed out that Britain supported such a collective approach because it contributed to an eventual common foreign policy and safeguarded a benevolent Chinese attitude towards Europe in general, and the UK in particular.52

But the British harboured no illusions about the effectiveness of such a collective approach:

‘there are awkward divisions within the Community; the impact on Chinese actions is not likely to be great; and the present honeymoon may end before long. The prospects for early and significant progress are therefore small, and we should be ill- advised to give China priority over joint Community action elsewhere.’ 53

Concerning a Community trade agreement with the PRC, Christopher Hum, an official in the British embassy in Beijing, informed London that he had not yet seen any suggestions. Moreover, judging from the dealings with the

Italians and West Germans they thought the Chinese were prepared to play it long.54

On the French side the ambassador to China, Etienne Manac’h, vehemently brought the issue of EC-PRC relations to the attention of his government. The opening quote of this chapter refers to the conclusions which Manac’h drew from a lunch he organised with his European

51 AMAE, Série DE-CE, 1967-1975, 1070, Relations Chine-CEE, Beaumarchais to Adresse Diplomatie Paris, London, 23 January 1973; AMAE, Série DE-CE, 1967-1975, 1070, Coopération politique à neuf - Chine et URSS, Beaumarchais to Adresse Diplomatie Paris, Londres, 23 January 1973. 52 NA, FCO 21/1097, confidential, Permanent Under-Secretary’s Planning Committee, The External Relations of the European Community: Relations with Non-European Communist countries, 8 March 1973. 53 Ibid. 54 NA, FCO 21/1096, Effect of our entry into the EEC on trading with China, Cochlin to Hum, 22 January 1973.

62 counterparts in early 1973. 55 In a letter to the French Foreign Minister

Maurice Schumann of 17 January 1973 he urged that the matter be put onto the agenda of the European Community.56 Similarly to the British analysis, yet more explicitly and illustrating the French view, Manac’h spelled out:

‘La R publique F d rale llemande, qui a, parmi les Neuf, le commerce le plus développé avec Pékin, s'est empressée de conclure un accord commercial bilatéral avant la fin de 1972, afin de prendre de vitesse la politique commerciale commune. Le Benelux a été moins rapide mais a entrepris des pourparlers et espère bénéficier d'une dérogation communautaire pour conclure un accord commercial en 1973. La Belgique se montre très empressée, et son Ambassadeur souhaiterait, pour sa part, que M. Harmel vint à Pékin pendant qu'il assure la présidence du Conseil des Ministres de la Communauté. Ne cherchent-t-elle pas surtout à profiter de l'aura communautaire pour que son Ministre reçoive un meilleur accueil des Chinois? Les derniers venus, j'ai eu l'occasion de la noter, sont les plus impatients. Enfin, les Britanniques, bien qu'ils manifestent ici un bon esprit de coopération, ne cherchent- ils pas à s'assurer la part du lion dans les relations des pays européens avec la Chine? Ils s'en défendent certes, mais ils mettent les bouchées doubles depuis la visite à Pékin de Sir Alec Douglas-Home. 57

Manac’h thus highlighted the national rivalries which made a common foreign policy difficult, if not impossible.

But Manac’h still repeatedly voiced his exasperation about the lack of joint Community action, as the opening quote of this chapter illustrates. He was particularly concerned about this lack because China continued to issue statements in support of European integration in stark contrast to the other

Communist states, and because of the growing international competition on the Chinese market. He viewed the Nine’s silence as particularly striking at

55 AMAE, Série DE-CE, 1967-1975, 1070, La Chine et la Communauté européenne, Manac'h to Schumann, Beijing, 17 January 1973. 56 Ibid. 57 Ibid.

63 the Paris Summit of October 1972 when only Sicco Mansholt, President of the

Commission had made an indirect allusion to the relationship with China when he stated that the Community ought to be open for collaboration with all the state trading countries including the Asian ones.58 He therefore put to the Foreign Minister that the member states either via the Council of

Ministers or EPC should acknowledge the European interest in liaising with

Beijing. 59

In September 1973, Pompidou visited the PRC, the first ever Head of

State and Government of a member state to do so. The Chinese welcomed him much more enthusiastically than they had Nixon. 60 Zhou Enlai emphasised during a meeting with the French President that China first wished to develop its relations with each member state before developing ties with the Community.61 Therefore the Chinese strategy to encourage on the one hand common European action but on the other hand competition between the member states added to the difficulty for the Community to develop a common approach.

Yet the British pushed for more coordination as a result of which the

EPC Political Committee created on 16 and 17 January 1973 a sub-committee, the EPC Asia Group. The mandate of the group was to give priority to the examination of questions in relation to links between China and Europe. The

EPC Presidency was to inform the member states’ ambassadors in Beijing of

58 Ibid. 59 Ibid. 60 Ebinger, 'The Politics of Potential', p.252. 61 AMAE, Série DE-CE, 1967-1975, 1070, Note la Chine et CEE, Froment-Meurice, Paris, 22 November 1973.

64 the work of the Political Committee, and ask them for their input.62 Such an input followed as the result of the Belgian ambassador inviting his counterparts for a working lunch on 31 January. The ambassadors signposted early on that the coordination was not just a matter for EPC. 63 The input from the embassies in Beijing illustrates the multi-level and multi-faceted process that shaped the Community’s approach to China.

It was the EPC Asia Group that established the political consensus on how to deal with the PRC – a step which proved to be crucial for all further developments. On 8 February 1973 the group decided unanimously that the

‘Chinesen seien diskret und ohne Drängen in ihrem Interesse an Europa, insbesondere hinsichtlich der Errichtung einer EG-Vertretung in Brüssel, zu ermutigen.‘ 64 In parallel the Belgian Political Director Etienne Davignon suggested to his colleagues to include the relations with China in the workings of the EPC too.65 Subsequently the nine foreign ministers adopted the group’s conclusion at their EPC meeting on 16 March 1973. The Nine had given the green light for the Community as such to engage with the PRC.66

One other consequence of Britain joining the Community was that the

Commission had to take into account the new constellation of member states.

It had to accommodate Britain, the new heavyweight, concerned about

62 PAAA, B21/200, Zwischenarchiv 1088883, Réunion Groupe de travail Asie le 14 mars 1974, 8 March 1974. 63 See 'suggestions pour l'agenda du groupe de travail 'Extrème Orient' du Comité politique des neuf pays membres de la CEE' referred to in: NA, FCO 21/1096, Morgan to Evans, Beijing, 8 February 1973. 64 PAAA, B21/200, Zwischenarchiv 108883, Bericht über Sitzung der Arbeitsgruppe ASIEN am 8.2.1973 in Brüssel, Gesprächsführungsvorschlag, Bonn, 16 February 1973. 65 NA, FCO 30/1657, Davignon to Oliver Wright, Brussels, 11 January 1973; PAAA, B21/757, Davignon to Berndt, Brussels, 11 January 1973. 66 AN, 5 AG 2, 1035, Réunion ministerielle de la Coopération politique, Bruxelles, 16 mars 1973, Rapports entre la Chine et l'Europe, Puaux, Paris, 20 March 1973; PAAA, B21, 200, Zwischenarchiv 108874, Davignon to Berndt, Brussels, 11 January 1973.

European integration calling into question its ‘special relationship’ with the

United States and its relations with the Commonwealth. Partly to reassure against such fears, Christopher Soames, the senior of the two incoming

British Commissioners, obtained the portfolio of external relations.67 Soames was Winston Churchill’s son-in-law, a Conservative politician who had been involved as Minister for Agriculture in the first British application for EC membership (1961-1963). A known Francophile, he had served until 1972 as ambassador to France where his main task was to help securing British entry to the Community. 68 Soames was as charismatic as voluble, a colourful personality, with a great deal of political savoir-faire.69

Soames also was a close personal friend of Henry Kissinger.70 While

Soames was still ambassador in Paris he used to meet Kissinger when the latter was conducting secret negotiations with the North Vietnamese to end the Vietnam war. The first seed of the idea to set up diplomatic relations between the European Community and China is thought to have grown out of

Soames’ private dinners with Kissinger in the French capital. Soames

‘thought “why can’t I do it, why can’t I do the same thing, surely Europe ought to have relations with China too, if the Americans can.” […] nd so Soames had this idea which nagged away at him, and because he was a very forceful man, he didn't just allow himself to say ‘well that is going to be very difficult, we can't do that'.71

67 Laurence Badel and Eric Bussière, Francois - avier rtoli: l Europe, quel numéro de téléphone?, (Paris: Descartes & Cie, 2011), pp.125–126. 68 See for example: Furby, 'The Revival and Success of Britain's Second Application for Membership of the European Community, 1968-1971'. 69 Furby and Ludlow, 'Christopher Soames, 1968-72'. 70 Interview, Lord Hannay of Chiswick, London, 10 March 2010. 71 Ibid.

Finding the best way to do so, remained the question however. Soames kept any deliberations secret. The only ones with whom he shared thoughts on this were David Hannay, his chef de cabinet, and François-Xavier Ortoli, the

European Commission President.72

As a result of the impetus that came from Soames, the Commission fostered the EC-PRC relationship increasingly and in multiple ways. Soames’ cabinet and the Directorate General for External Relations (DG I) kept a close eye on the member states’ activity at COREPER, but also at EPC. 73 They supported the member states’ favourable attitude towards a Chinese initiative to set up official relations. 74 This corresponded with Ortoli telling the

European Parliament in February 1973 that the Community had to develop its relationship with China. 75 Soames also promoted the Commission’s activity amongst the business community. Speaking at the London Guildhall to the Association of Overseas Bankers on 5 February 1973 he referred to

China when pointing to the necessity of Europe speaking with one voice.76

Soames also briefed influential business leaders heading to China on the

Community’s position because he anticipated that the Chinese would probe them about the Commission’s attitude.77

72 Ibid. 73 ECHA, BAC 136/1987/868, Conférence ministérielle de la Coopération politique - République populaire de la China, Meyer to Ortoli and Soames, Brussels, 27 March 1973; see also the hand-written notes on: ECHA, BAC 136/1987/624, 683rd meeting of the Committee of Permanent Representatives, meeting of 17 April 1973, Relations with the People's Republic of China, Meyer to Ortoli and Soames, Brussels, 24 April 1973. 74 ECHA, BAC 136/1987/624, China, (author illisible) to Ortoli, 3 May 1973. 75 See also: Wilson, 'China and the European Community'. 76 ECHA, Speech collection, Soames, Discours prononcé le lundi 5 février 1973 au Guildhall de Londres devant l’association des Overseas Bankers. 77 ECHA, BAC 136/1987/628, China, Grierson to Soames, Brussels, 3 May 1973; see also previous correspondance: ECHA, BAC 136/1987/628, Visit to China, Soames to Grierson, 12 April 1973.

Although Soames was now the vice-president of the Commission and supposedly impartial to any member states, he himself and his cabinet frequently exchanged views and information with the FCO. For example

Hannay shared with the FCO in June 1973 his analysis on the increasing contacts with the Chinese:

‘ s you are probably aware members of the Chinese Embassy in Brussels are in fact fairly frequent visitors in the Commission offices these days and are gluttons for information on every aspect of Community life. […] ll this leads me to suppose that it is not the lack of information which is prompting these numerous contacts both with us and with representatives of the member states. Rather I suspect it is an attempt to probe differences of appreciation on such delicate issues as, for example, the scope and nature of the common policy. It will no doubt not have escaped their attention that a question on that subject put to a Commission official and to a French diplomat is likely to provoke two rather different replies!’78

Thus close communication channels between the Soames’ cabinet and the

FCO existed, and few illusions persisted on how the Chinese navigated in between the different institutions.

The first enlargement gave impetus to a concerted Community approach to the PRC. Britain pushed the topic onto the EPC agenda and supported the Commission’s participation in the EPC. t the Quai d’Orsay it was Manac’h who urged from Beijing for the Council of Ministers and the

Commission to publicly welcome the EC-PRC relationship. The member states’ ambassadors’ input and the EPC sia Group crystallised the political consensus to encourage the Chinese to set up official relations with the

Community. Soames supervised an increasingly active role of the

Commission on the one hand with the Chinese, on the other hand with EPC,

78 NA, FCO 30/1713, EEC-China, Fergusson to Morland, Brussels, 22 June 1973.

Coreper, the European Parliament, the FCO and the business community. A clear definition of who was to speak for the Community vis-à-vis China however was still missing.

Growing political contacts do not parallel economic ones

The question of who was to speak for the Community became more pressing in early 1973 when the Chinese queried Manac’h at the embassy in Beijing about setting up official relations with the Community. The Head of the

Europe Section at the Chinese Ministry of Foreign Affairs asked how the

Europeans would receive such an initiative. Whereas previously the member states had dealt with the issue at EPC, now COREPER and the Commission stepped in and assumed responsibility.79 The increase in political exchanges however did not parallel economic ones.

The member states agreed on conveying a positive reply through the same channel to keep the communication relatively low-key and leave the initiative to the PRC to approach the Commission. Still, the British were wary of the French acting as the Community spokesperson. Manac’h also perceived a competition on who was to speak for the EC: ‘Je sais que certains de mes collègues de la Communauté et notamment mon collègue belge, brûlent de faire la même communication aux chinois.’80 Perhaps surprisingly, the French agreed not to become the EC spokesperson and to leave the initiative entirely

79 NA, FCO 21/1097, Evans to Davies, April 1973; BAC 136/1987/624, 683rd meeting of the Committee of Permanent Representatives, 17 April 1973, Relations with the People's Republic of China, Klaus Meyer, Commission Deputy Secretary General, to Ortoli, Soames, Brussels, 24. April 1973. 80 AMAE, Série DE-CE, 1967-1975, 1070, Chine-CEE, Manac'h to Adresse Diplomatie Paris, Beijing, 4 June 1973.

69 to the PRC. 81 Jean-Pierre Brunet, Directeur des Affaires économiques et financières au D partement Europe, emphasised to Manac’h: ‘nous ne souhaitons pas que la France paraisse agir, en ce domaine, en porte-parole de la Communauté. C'est en réponse à une question qui vous a été posée que vous apporterez à vos interlocuteurs l'information souhait e.’ 82 Hence

Manac’h’s appeal for the Council of Ministers to step up their game did not resonate in Paris or in Brussels. And the British and French agreed that

Manac’h was not to act as a spokesperson for the Community.

But the rationale behind the Quai d’Orsay’s and the FCO’s position was different. The British did not want the French to monopolise a role which could give them national advantages. The French were cautious not to act as spokesperson because they did not want the Chinese to think that the French foreign policy was bound by Community decision-making. Moreover,

Brunet’s instruction reflected the stance that France did not wish more coordination in foreign policy because it wanted to retain its room for manœuvre. China was not to create a precedent.

Compared to their British and French partners, the Germans were more eager to see the Commission speak in the name of the Community. Their position emerges clearly in the stance the German Foreign Ministry took at a session of the ‘ ktionskommittee für die ereinigten Staaten von Europa’ in

April 1973. The Action Committee was a European think tank founded in

1955 amongst others by Jean Monnet. Whereas the Germans agreed to leave

81 AMAE, Série DE-CE, 1967-1975, 1070, Relations Chine-CEE, Manac'h to Adresse Diplomatie Paris, Beijing, 29 May 1973. 82 AMAE, Série DE-CE, 1967-1975, 1070, Chine-CEE, Brunet to Ambafrance Pékin, Paris, 2 June 1973.

70 the initiative to China, they thought that it would eventually be the role of the

Commission to take up the dialogue with the PRC after a consultation procedure with the Council.83

The institutional confusion on responsibilities grew when the member states decided at the EPC Asia Group on 16 May 1973, rather than at

COREPER, to give a favourable answer to the Chinese query.84 During the meeting itself, the struggle regarding the competencies between the

Community and EPC surfaced. The French representative argued that China’s relation with the EEC was outside the group’s competence. But the Belgian

President and the rest of the group overruled him. The majority agreed that the matter was a political question on which the EPC Asia Group was entitled to express its views. 85 Adding to the complexity, the member states representatives again tabled the issue one day later, but this time at

COREPER.86 Now the Commission stepped in and asserted that the EC-PRC relations were a matter for the Community to deal with rather than EPC.

Edmund Wellenstein, director general at DG I of the European Commission, expressed his irritation that a sub-level of EPC dealt with the issue during the

COREPER meeting of 17 May. 87 It is realistic to assume that due to

Wellenstein’s criticism, the EPC sia Group ceased to discuss the

83 PAAA, B201/411/422, Sitzung des Aktionskomittees für die Vereinigten Staaten von Europa, Dortige Zuschrift vom 19.4.1973, Lautenschlager to Referat 200, Bonn, 24 April 1973. 84 See reference in: ECHA, BAC 136/1987/624, 686ème réunion du Comité des représentants permanents, Relations avec la République populaire de Chine, Brussels, 17 May 1973. 85 NA, FCO 30/1659, European Political Co-operation: Political Committee Meeting, 24/25 May 1973, Item 7: Relations avec l'Asie, undated. 86 For the handling of the matter by the member states in Brussels and the national capitals, see: NA, FCO 30/1712, China/EEC Meeting of the Committee of Permanent Representatives Part 2, Palliser to FCO, Brussels, 17 May 1973. 87 ECHA, BAC 136/1987/624, 686ème réunion du Comité des représentants permanents, Relations avec la République Popularie de Chine, Brussels, 17 May 1973.

71 establishment of official relations, leaving it to COREPER and the

Commission to deal with the dossier.88

The press picked up on the growing contacts. Reports circulated that the

Chinese had visited Wellenstein to indicate the imminent ‘normalisation’ of the relations with the accreditation of diplomatic representatives to the

Community.89 The sensitivity of the matter and the member states vigilance is illustrated in the COREPER meeting of 2 October 1973. The Italian representative Giorgio Bombassei de Vettor asked for clarification of these press reports. Umberto Stefani, the Commission representative, confirmed that an official of DG I had had routine contacts with the Chinese officials.

But Stefani explained that none of the claims about diplomatic accreditation were true, and the Commission had issued a rebuttal against those press reports.90

Despite these multiplying and intensifying contacts, EC-PRC trade had stagnated since 1969. Chinese imports from the Nine even decreased in 1972.

The Community of the Nine had for the first time in years a balance of trade deficit vis-à-vis the PRC.91 According to the Auswärtiges Amt, the imports by the Community from China in 1972 were US$ 280 million, which represented

88 NA, FCO 30/1660, European Political Cooperation: Political Committee meeting Copenhagen 4/5 September: Agenda item 5: Asie (Réunion du 27 aout du Groupe de travail Asie), Far Eastern Department, 31 August 1973. 89 NA, FCO 21/1098, Committee of Permanent Representatives, meeting of 2 October 1973, EEC/China, Palliser to FCO, Brussels, 2 October 1973; ECHA, BAC 136/1987/624, Réunion extraordinaire du Comité des représentants permanents du 2.10.1973, Contacts entre diplomates de la République populaire de Chine et hauts fonctionnaires de la Commission, Stefani to Wellenstein, Brussels, 2 October 1973. 90 NA, FCO 21/1098, Committee of Permanent Representatives, meeting of 2 October 1973, EEC/China, Palliser to FCO, Brussels, 2 October 1973; ECHA, BAC 136/1987/624, Réunion extraordinaire du Comité des représentants permanents du 2.10.1973, Contacts entre diplomates de la République populaire de Chine et hauts fonctionnaires de la Commission, Stefani to Wellenstein, Brussels, 2 October 1973. 91 ECHA, BAC 136/1987/624, Le commerce extérieur de la Chine: structure et perspectives de développement, Brussels, 23 February 1973.

0.3% of the total imports by the Community and 13% of the total exports of the PRC. The exports by the Community to China in 1972 were US$ 333 million, hence 0.3% of the total exports by the Community and 13% of the total imports by China. This flat trade trend contrasted with the 1958 to 1969 period during which it had tripled.92

The Europeans still did not expect any rapid improvement in trade because they viewed the interest of the Chinese in the Community as being primarily political in nature. 93 According to the Commission, the

Community’s part in the PRC’s trade further diminished from 1972 to 12.3% in 1973.94 Amongst their EC-partners Germany had in 1973 the biggest total trade volume with the PRC, followed by the UK, France and Italy. The ranking of the first 12 trading partners with the PRC in 1973 looked as follows:95

Table 0-2: Ranking of the first trading partners with the PRC in total trading volume in 1973

Country Ranking amongst Total trading volume with the first 10 the PRC in million US$

Japan 1 2.015

Hong Kong 2 1.154

United States 3 753

92 PAAA, B201/411/433, Verhältnis EG-VR China, 8 November 1973. 93 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (4ème rapport), 3 April 1975. 94 ECHA, BAC 48/1984/687, Information relation extérieures, La République populaire de Chine et la Communauté européenne, undated. 95 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (3ème rapport), 24 October 1974.

Country Ranking amongst Total trading volume with the first 10 the PRC in million US$

Germany 4 449

Canada 5 351

Britain 6 318

Singapore 7 290

Soviet Union 8 240

Australia 9 226

France 10 224

The type of goods that the Chinese imported in 1973 remained mainly industrial equipment and material for transport. 96 This needs to be understood against the background of the Chinese fourth Five-Year-Plan that set out to modernise the Chinese economy, i.e. to develop its agriculture and industry. 97 In 1973, the principal benefactors regarding contracts for industrial plants and equipment were France in the area of petro chemistry, the Netherlands with dredges and urea plants, Britain in respect of mines and

Trident airplanes, and Italy with electrical plants. 98 The German Foreign

Ministry remarked soberly:

‘Die RChina sieht in einem geeinten starken Europa vor alleim ein politisches, wirtschafltiches und militärisches Gegengewicht zur Sowjetunion. Das wirtschaftliche Interesse Chinas an der Gemeinschaft ist demgegenüber nur von nachgeordneter Bedeutung. Der Umfang des Handels zwischen der VR China und

96 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974. 97 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des Conseillers Commerciaux (2ème Rapport), 26 March 1974. 98 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974.

der EG ist […] gering. Anzeichen für eine wesentliche Änderung liegen nicht vor’.99

Thus rather than trade, which seemed limited in the foreseeable future, political factors turned out to be the principal concern for the Europeans.

The issue of the PRC accrediting a representative to the Community became more concrete and acute. The Commission ensured that a concerted

EC approach to China was not left for EPC to deliberate on. The growing diplomatic contacts between the Europeans and the Chinese were not paralleled in commercial contacts. Politics not trade defined the relationship.

The nature of the political considerations of the Community were two-fold.

On the one hand they related to the internal, bureaucratic politics on how to conduct the Community’s external relations. On the other hand the issue of how to position the EC in international affairs, particularly vis-à-vis the

United States and the Soviet Union, heightened the salience of the politics within the Community.

New leverage: the Sino-Soviet competition

The EC-PRC rapprochement provoked more contacts between the

Community and the Soviet bloc. Closer relations between the EC and China, as the French ambassador to Moscow Roger Seydoux reported, meant that the Community extended its responsibility into foreign policy, a further step of political integration which the Soviets feared.100 Wellenstein recalls the

Soviet attitude towards the Community, and particularly the Commission:

99 PAAA, B201/411/433, Verhältnis EG-VR China, 8 November 1973. 100 AMAE, Série DE-CE, 1967-1975, 1070, La Chine, la Grande-Bretagne et l'Europe occidentale, Seydoux to Adresse Diplomatie Paris, Moscow, 8 January 1973.

‘The Russians did not want to have anything to do with us. Taboo. We didn't exist. We were destined for the dust-bins of history. So why deal with us.

There was no contact.’101 The contacts to China offered political legitimacy to the Community, particularly the Commission.

The question the Europeans faced was whether playing the China card towards the rest of the Eastern bloc was an advantageous strategy. In other words, was it opportune to use the EC-PRC relationship to press the Soviet

Union for concessions? The British explicitly warned against doing so, even before Britain became a member. In a paper of 30 November 1972 on the external relations of the EC, the FCO analysed:

‘In the longer run, the degree of solidarity achieved by the Community in its dealings with the Soviet Union will also be relevant to its future relations with China […]. The Chinese already regard the Community as a potential asset in their own rivalry with the Soviet Union. For Western Europe, the value of Chinese benevolence must be weighed against the far greater importance of relations with the Soviet Union.’102

In a later note of 22 March 1973 the British continued to insist that ‘playing the China card’ was a dangerous strategy because it could jeopardise the

Europeans’ relationship with the Soviets:

‘the fact that China is now the enemy of our enemy does not mean that Western Europe will ever be able to count on China as an ally. To suggest to the Russians that we regarded this as a potential role for China could thus be dangerous: it would be just convincing enough to arouse resentment, not enough to instil a salutary fear….Moreover, although the Sino-Soviet dispute may indirectly assist the development of the Community's separate relationships with both China and the Soviet Union, it would be unwise to allow the dispute to modify the content of Community policies. Nor would it be prudent of the Community to make overt efforts to

101 Interview, Edmund Wellenstein, The Hague, 6 January 2010. 102 NA, FCO 49/391, The External relations of the European Community: relations with the Soviet Union and Eastern Europe, 30 November 1972.

influence or exploit this dispute. These views are probably shared by most of our partners, whose coordination of policy in the politico-military sphere is, in any case, likely to be tardy and cautious.’ 103

Consistent with this analysis, Evans noted in April 1973 in the deliberations of how to reply to the Chinese approach of Manac’h in Beijing on the establishment of official relations: ‘[…] several of the Ministers showed concern about the likely reactions of the USSR to closer links between China and the EEC’.104

The British used any opportunity to push their views within the

Community. Crispin Tickell for example took advantage of a dinner in

Luxembourg on 8 May 1972 to speak to Mrs Thorn, wife of the foreign minister of Luxembourg. Tickell was then Private Secretary to successive

Chancellors of the Duchy of Lancaster, the minister responsible for the negotiations for British entry into the European Community (1970-1972).

Mrs Thorn had told Tickell that a Chinese friend of hers, Han Suyin, was to see Zhou Enlai. Mrs Thorn confided that she had transmitted a ‘message officieux’ from the Community to Han Suyin to ask her to find out all she could from Zhou Enlai about the Chinese attitude towards the Community and Western European integration. Tickell then put it to Mrs Thorn that ‘it would certainly be a coup for the Chinese if they could appoint an

mbassador to the Community before the Russians’. Tickell calculated that

103 Ibid. 104 NA, FCO 21/1097, Evans to Davies, April 1973.

Mrs Thorn shared his message with her husband, who was then acting

Chairman of the Council of Ministers.105

The French shared the British assessment on the risk of irritating the

Soviets if the Community supported a closer relationship with the Chinese:

‘Si en revanche l'on devait se prononcer sur la suite à donner à une demande spontanée de la Chine, le problème serait essentiellement de présenter les choses de manière a heurter le moins possible les Sovi tiques.’106 Manac’h therefore also advocated the strategy of leaving to China the initiative to liaise with the Community. The French ambassador emphasised the necessity for caution to his counterparts too.107

The Conference on Security and Cooperation (CSCE) added a further dimension to the risks posed by the Community’s dealings with the PRC. The

French particularly signposted this. Jacques de Beaumarchais, Directeur

Politique of the Quai d’Orsay, wrote in a note on 9 January 1973: ‘Medici [the

Italian foreign minister] parlera sans doute au Ministre de son idée de manifester l'intérêt des Neuf pour la Chine. L'initiative est difficile […] parce que il y a les Russes et la pr paration de la CSCE.’108 These concerns were further reflected in a note a few days later, on 29 January, when preparing for a meeting at EPC.109 The strategy for the French therefore remained that the

105 NA, FCO 30/1282, China and the Community, Tickell to Mason, 15 May 1972. 106 AMAE, Série DE-CE, 1967-1975, 1070, Coopération politique à neuf - Chine et URSS, Beaumarchais à Adresse Diplomatie Paris, Londres, 23 January 1973. 107 AMAE, Série DE-CE, 1967-1975, 1070, Coopération politique à neuf, programme de travail "Chine", Beijing, 2 February 1973. 108 AMAE, Série DE-CE, 1967-1975, 1070, Beaumarchais, Paris, 9 January 1973. 109 AMAE, Série DE-CE, 1967-1975, 1070, Chine-CEE, 29 January 1973.

Community was to welcome closer EC-PRC relations, but it was for the

Chinese to take the initiative. 110

The member states’ caution and reluctance to use the China card was evident at EPC level also. During the meeting of 16 March 1973 the Foreign

Ministers André Bettencourt, Alec Douglas-Home, Walter Scheel and

Giuseppe Medici all agreed: good relations with the Chinese represented ‘un facteur d'équilibre vis-à-vis de l'URSS. Mais si les Neuf définissaient leur attitude à l'égard de la Chine, il fallait qu'ils tiennent compte de leurs relations avec les Sovi tiques.’111

In like manner, the European Parliament had its say on the geopolitical dimension of the EC-PRC relationship. In a debate on Tuesday 13 February

1973, Renato Sandri, an Italian MEP first non-attached then member of the

Communist and Allies Group, put to Soames:

‘the hope that the Community will attempt to bring about the closest possible relations with the People’s Republic provided that it does not become an instrument of the cold war in a new international situation, but conducts effective policies to help the People’s Republic of China emerge from its stage of underdevelopment.’112

The European Parliament equally warned against instrumentalising China in the Cold War.

110 AMAE, Série DE-CE, 1967-1975, 1070, Note Chine-CEE, 29 January 1973. 111 AN, 5 AG 2, 1035, Réunion ministérielle de la Coopération politique, Bruxelles, 16 mars 1973, Rapports entre la Chine et l'Europe, Puaux, Paris, 20 March 1973. 112 Sitting of 13 February 1973, Oral Question No. 30/72, Official Journal, 1973.

In contrast, the Commission adopted a more aggressive stance on how the Community could exploit the Sino-Soviet rivalry to its advantage. 113

Soames’ cabinet and the DG I closely followed the member states dealings at the EPC as is shown by the reporting of Klaus Meyer, Deputy Secretary

General, to Ortoli and Soames.114 ccording to Wellenstein, the Commission’s aim was to isolate the Soviet Union, leaving it as the only blank spot on the world map which had not yet engaged officially with the EC.115

The press also picked up on the Sino-Soviet competition for links to the

European Community. On 1 February 1973 the Frankfurter Allgemeine published an article by Harry Hamm reporting from Brussels, and the French diplomatic translation read:

‘Depuis longtemps d jà la R publique populaire de Chine accorde à la Communauté européenne une attention particulière. Elle s'inspire de considérations politiques plutôt qu'économiques et c'est pour cette raison qu'à Bruxelles l'intérêt croissant que suscite à Pékin le développement institutionnel et l'élargissement de la Communauté est quand même accueilli avec une grande réserve, en dépit de signes d'une certaine satisfaction. […] Il ne fait pas de doute que l'attitude positive qu'adopte la Chine vis-à-vis de la CEE représente un problème délicat pour les dirigeants soviétiques. Ce malaise se reflète dans l'évolution de la polémique entre Moscou et Pékin à propos de la CEE, qui est devenue plus vive précisément au cours des dernières semaines. Pourtant l'URSS n'avait jusqu'à ces derniers temps aucun motif d'incriminer la politique suivie par la Chine à l' gard de la CEE.’116

113 Interviews; see also: NA, FCO 30/1282, China and the Community, Tickell to Mason, 15 May 1972; NA, FCO 40/460, The external relations of the European Community, Permanent Under-Secretary’s Planning Committee, 22 March 1973. 114 ECHA, BAC 136/1987/868, Conférence ministérielle de la Coopération politique - République populaire de la China, Meyer to Ortoli and Soames, Brussels, 27 March 1973. 115 Interview, Edmund Wellenstein, The Hague, 6 January 2010. 116 NA, FCO 30/1712, Conseil des Communautés européennes, Secretariat General, Feuille Documentaire n°21/1973, 'Pekin et la Communauté économique européenne" - Frankfurter Allgemeine Zeitung by Harry Hamm, Brussels, 1 February 1973.

Therefore, the wider implications of the developing EC-PRC relationship for the Community’s position in the Cold War were in the open.

Fuelling the geopolitical calculations, Nicolai Fadeyev, then COMECON secretary-general, suggested in August 1973 to the Danish President of the

Council of Ministers Ivar Norgaard to organise contacts between COMECON and the Community. 117 When Norgaard replied that the Commission was responsible for such matters, Fadeyev invited the President of the

Commission on 16 September 1973 to visit Moscow for preliminary talks with

COMECON.118 The Commission's accepted the invitation but suggested that preparatory talks by officials precede any high-level contacts. As Xavier du

Cauzé de Nazelle, minister-councillor at the French embassy in Moscow, reported to Paris, COMECON’s sudden initiative seemed more than simply a coincidence, and the potential recognition of the Community by China was likely to have played a role.119

The Chinese in the meantime kept a close eye on Soviet policies towards the Community both regarding the CSCE and COMECON. At the twelfth session of UNCTAD in Geneva in October 1972, for example, Kuan Qianghua, a PRC representative, put it to a Community official that the Chinese were to take up contacts with the Community in Brussels before the CSCE began, and preferably even before the 22 November, the date of the preparatory meeting

117 European Commission, Eighth General Report on the Activities of the European Communities in 1974, (Brussels: EEC, 1975), p.261; Kansikas, 'Trade Blocs and the Cold War. The CMEA and the EC Challenge, 1969- 1976', p.183. 118 European Commission, Seventh General Report on the Activities of the European Communities in 1973, (Brussels: EEC, 1974). 119 AMAE, Série DE-CE, 1967-1975, 1064, Relations entre le CAEM et le marché commun, Nazelle to Adresse Diplomatie Paris Directeurs Moscow, 9 August 1973.

81 to the conference.120 As illustrated by a meeting on 14 September 1973, the

Chinese also questioned the Commission about Fadeyev’s initiative.121

A competition between the PRC and the Soviet Union for closer relations with the Community began. All member states warned against playing the China card because in the final analysis their relationship to the Soviet Union was more critical, and so were their objectives for European détente which they pursued at the CSCE. The European Parliament consented on the issue. The

Commission was the party most willing to play up the Sino-Soviet rivalry, which future developments confirm. A possible reason was that the

Commission did not have much to lose, as opposed to the member states. The member states’ caution was also apparent in discussions within the EPC. It also mattered when the Nine elaborated on the Declaration of European

Identity, in which they laid out their position towards the rest of the world, including the Soviet Union and China.

Towards a concerted foreign policy: the Declaration of European

Identity

The clearest evidence of the rising salience of China within EC politics was that the member states pledged to strengthen the cohesion of their foreign policies towards the PRC in their Declaration of European Identity.122 The foreign ministers published the Declaration on the margins of the

120 AMAE, Série DE-CE, 1967-1975, 1070, CEE-Chine, Ministère d'état chargé de la défense nationale, SDECE, 14 November 1972. 121 ECHA, BAC 136/1987/628, Compte-rendu succint d'une visite de représentants de l'ambassade de Chine à Bruxelles le 14 septembre 1973 à 17h00, Brussels, 17 September 1973. 122 Declaration of European Identity, in European Commission, Bulletin of the European Communities, 12/12, 1973, pp.118–122.

Copenhagen Summit of the Heads of State and Government. 123 The

Declaration reflected a concept of European identity concerned with the

Community rather than Europe as a whole. The concept was based on three aspects: the cohesion of the Community, the position and the responsibilities of the Nine vis-à-vis the rest of the world, and the dynamic character of the construction of a United Europe.124

The Declaration followed the decision at the Summit conference in 1972 to construct a European Union by 1980, and was a response to several structural changes in international relations.125 Generally, the Declaration of

European Identity was important because the Nine sought to include in a single document all the main elements on which they agreed in working towards a European foreign policy. 126 It defined the extent to which the member states were already united, both among themselves and in relation to the rest of the world, and set out the intentions for developing a common

123 Gainar, Aux origines de la diplomatie européenne, pp.131–141. 124 NA, FCO 30/1752, European Co-operation on foreign policy: The European Identity Paper, Douglas-Home, 13 December 1973. 125 Refer to: AN, 5 AG 2, 1035, Note confidentielle du Comité politique aux ministres des affaires étrangères relatif au fonctionnement de la Coopération politique européenne, RM (73) 8 P révisé, Copenhague, 18 July 1973; see also Ortoli's analysis: 'The reasons for the European leaders perceiving the need to define a European identity are varied. The British outlined in November 1973 that defining the identity of the Community was an integral part of the long- term task which the Community assigned itself in the 1972 Paris Summit meeting. Indeed the Paris Summit Communiqué stated in the context of political cooperation the aim of common, medium and long-term positions on foreign policy questions', NA, FCO 30/2000, Outline of talk given by M. François-Xavier Ortoli, President of the Commission of the European Communities at the Royal Institute of International Affairs (Chatham House), London, 23 February 1973. A further reason to define a European identity was the understanding that external pressures would ‘increasingly force this task upon them as a condition of international survival’, that ‘China, Japan, the Soviet Union, and the United States are entities so large and powerful for any of the Nine to match on their own. The pressures that will be exerted by these great centres of power in the economic, monetary, political and military fields will by themselves force the Nine to intensify their cooperation and to extend its scope.’, P , Zwischenarchiv 121679, The Identity of the Nine vis-à-vis the United States - Britisches Papier, 2 November 1973. Strath, 2002; Bitsch, Poidevin, Loth, pp.8–9. 126 NA, FCO 30/1752, European Co-operation on foreign policy: the European Identity Paper, Douglas-Home, 13 December 1973; NA, FCO 30/1750, European Identity, Marsden to Bayne, undated; AN, 5 AG 2, 1035, Comité politique des 12 et 13 Novembre, undated.

83 position in relation to other countries. According to Bo Stråth it was this

Declaration that introduced the concept of identity to the political agenda of the Community.127 Such an introduction was all the more remarkable because the Nine did so via their foreign policy.128

Specifically, the Declaration was significant because for the first time the Nine declared publicly their intention to adopt a common approach towards China. The member states referred to the PRC in the second section of the paper, where they listed the Community’s attitude to different parts of the world. The list began with relations to the other Western European countries, followed by the Mediterranean, African and Middle Eastern countries, the United States, other industrialised countries such as Japan and

Canada, the Soviet Union and Eastern Europe, China and the other Asian countries, Latin America and the developing world. The historian Lutz

Niethammer correctly interprets the order of the listing as a deliberate hierarchy of relations from the most to the least important.129 Moreover, it is revealing that the Nine only mentioned certain countries by name. These included besides China, the US, the Soviet Union, Japan, and Canada. But

India and Brazil did not make it onto the list nor did any Arab countries.130

127 Stråth Bo, 'A European Identity: to the Historical Limits of a Concept', European Journal of Social Theory, 5, no. 4, 2002, 387–401. 128 Kreis Georg, 'L'émergence de la notion d'identité dans la politique de la Communauté européenne. Quelques réflexions autour de la Déclaration du sommet de Copenhague de 1973', Relations internationales, 140, no. 4, 2009, 53–72. 129 Niethammer Lutz, 'Konjunkturen und Konkurrenzen kollektiver Identität. Ideologie, Infrastruktur und Gedächtnis in der Zeitgeschichte ', in Werner Matthias (ed.), Identität und Geschichte, 175–203, (Weimar: Jenaer Beiträge zur Geschichte, 1997). 130 Compare: NA, FCO 30/1752, India/Nine, Douglas-Home to UK Rep Brussels, 12 December 1973.

The evolution of the reference to China was peculiar. Originally, the

British prime minister suggested to the French Foreign Minister Michel

Jobert to conceive a paper in which the Nine defined their identity vis-à-vis the United States.131 Subsequently the nine foreign ministers decided in July

1973 on a mandate for the EPC to design a Declaration of European

Identity. 132 But when the British proposed a draft in August 1973 that focussed mainly on the United States, the French, Italians and others sought to widen the scope. 133 In fact, already in January 1973 Davignon had suggested to his colleagues to lay out the Community’s relationship to all parts of the world. China featured in his considerations too. 134 When the

French tabled their version of the paper, the British did not mind the reference to China. In a letter of 14 September 1973 for instance James Eric

Cable, FCO head of Planning Staff, commented to Butler that the proposal

‘might provide an opportunity to ask the French how far they envisage the

Nine should “define common position” in relations with Peking. Up to now they have seemed more interested in preserving their own freedom of movement in developing Franco-Chinese relations.’135 Whether to include the

PRC remained uncertain until November as illustrated in the minutes of a

Ressortgespräch in the German Foreign Ministry.136

131 NA, FCO 30/1752, European Co-operation on foreign policy: the European Identity Paper, Douglas-Home, 13 December 1973. 132 NA, FCO30-1750, Telegram, Transatlantic relations, Douglas-Home to Washington, 31 August 1973. 133 NA, FCO 30/1750, Transatlantic relations, Douglas-Home to Washington, 31 August 1973. 134 NA, FCO 30/1657, Davignon to Oliver Wright, Brussels, 11 January 1973; PAAA, B21/757, Davignon to Berndt, Brussels, 11 January 1973. 135 NA, FCO 30/1750, Cable to Butler, 14 September 1973. 136 PAAA, Zwischenarchiv 121679, EPZ-Identitätspapier, 5 November 1973.

Although the Commission and the European Parliament did not specifically play an active part in writing the Declaration, they still provided the impetus for the Community to define its identity in international relations. For example Ortoli underlined the necessity for Europe to speak with one voice to the European Parliament on 13 February 1973 and at the

Royal Institute of International Affairs in the same month.137 Similarly, the

European Parliament did not have a direct input in the declaration, but, ironically, it was the institution that had been most active in calling for a concerted European voice when dealing with the PRC.138

The Chinese government and the European press were attentive to the

Declaration too. ‘Deutsche Welle’, the German broadcasting agency, for example, noted:

‘Den gleichen Rau, der dem speziellen erhältnis zum Ostblock gewidmet ist, erhält - und das ist eine, wenn auch erklärliche Überraschung - das Verhältnis zur Volksrepublik China. Ihr wird eine Vertiefung der Beziehungen und der Austausch europäischer und chinesischer Führungskräfte angetragen.‘139

The Chinese attentively followed the drafting of the paper. Evidence is seen in a visit to the Commission by Sung Wankuo, attaché at the Chinese embassy in

Brussels, and Xie Chenlu, third secretary, on 14 September 1973. Whilst proving to be well-informed on the subject as far as a reading of the press

137 NA, FCO 30/2000, Outline of Talk given by M. François-Xavier Ortoli, President of the Commission of the European Communities at the Royal Institute of International Affairs (Chatham House), London, 23 February 1973. 138 Kreis Georg, 'L'émergence de la notion d'identité dans la politique de la Communauté européenne. Quelques réflexions autour de la Déclaration du sommet de Copenhague de 1973', p.55. 139 PAAA, Zwischenarchiv 108865, Kommentar der deutschen Welle zur Deklaration, undated.

86 allowed, they put pressing questions on the content of the paper too.140 Thus the Declaration of European Identity mattered not only to the Europeans in their attempt to foster the cohesion of the Community but also to the

Chinese.

Whereas previously the member states had insisted on a low-key approach by the Community to China, the Declaration of European Identity amounted to a ‘big bang’. For the first time the Nine publicly pledged to work towards a common approach to the PRC. The Declaration epitomises the dual function that the relationship to China had. It served the Community to position itself in the dramatically changing international affairs of the 1970s, and to help towards the cohesion of the Nine. It was a subject that was to help the Community’s internal cohesion.

Conclusion

Détente enabled the Nine, and therefore the Community as such, to liaise with Mao’s China. But still, the Cold War, China’s communism and the

Cultural Revolution were all factors that held the national governments back from jumping ahead. n extremely cautious attitude characterised the Nine’s relation to the People’s Republic. The European Community offered to the member states an additional foreign policy instrument they could use to build and test national bridges to Beijing. Meanwhile, for the European Parliament the EC-PRC relationship held the potential to increase its visibility, and push its role as a parliament. For the Commission the China dossier offered the

140 ECHA, BAC 136/1987/628, Compte-rendu succint d'une visite de représentants de l'ambassade de Chine à Bruxelles le 14 septembre 1973 à 17h00, Stakhovitch to Wellenstein, de Kergorlay, Soames cabinet, Brussels, 17 September 1973.

87 possibility to prove to the Nine how it could add value to purely inter- governmental coordination. Soames taking up office as Commission vice- president was the person determined to use that possibility. Not least the ensuing Sino-Soviet competition for relations with Brussels showed that the

Commission wielded a unique political asset, a supranational platform, which the member states had an interest in leaving room for manoeuvre for. For both, the European Parliament and increasingly for the Commission, China represented a political opportunity.

The Community faced the task of defining how to deal with China first in relation to its Common Commercial Policy. The Council decision of 16

December 1969 was a landmark because it conferred competence upon the

Commission competence to renegotiate any trade agreement with the PRC on

1 January 1975. But the commercial contacts did not parallel the growing diplomatic ones. Politics not trade shaped the relationship.

The politics concerned two interlinked areas. On the one hand political wrangling related to the internal, bureaucratic politics on how to conduct the

Community’s external relations. In this light, a first distinctive approach by the Nine was the UN vote in favour of the PRC and against American policy.

The Commission began to foster direct, if still unofficial, contacts with

Chinese representatives in Brussels once Zhou Enlai publicly expressed interest in official EC-PRC relations in May 1972. Britain’s accession to the

Community gave the EC-PRC relationship important impetus. Crucially, it meant that Soames gained the responsibility of Commission vice-president responsible for external relations. A defining political decision came on 16

March 1973 at the EPC, when the nine foreign ministers gave the green light

88 for the Community as such to engage with the PRC. 141 Meanwhile, the

Commission and the European Parliament ensured that a concerted EC approach to China was not left for EPC alone to deliberate on.

On the other hand the politics obviously concerned how to position the

EC in international affairs. By the end of 1973 the member states and the

Commission were in favour of official EC-PRC relations, and they had agreed on a strategy: the Chinese rather than the EC were the ones to take the initiative. The underlying reason lay in Cold War politics. These politics became apparent in the rivalry between Beijing and the Soviet Union for closer relations with the Community. They also explain the consensus in the

Community that playing the China card was risky. A further layer was added by the Declaration of European Identity, where the Nine pledged publicly for the first time to work towards a common approach to the PRC. The origins of this document lay in the Nine’s endeavour to assert their independence vis-à- vis the United States.

But this Declaration of European Identity did not appear to the

Europeans to have much of an effect on the Chinese. The German ambassador reported on 21 December 1973 on his conversation with Qiao

Guanhua, who would become Chinese foreign minister in 1974. According to this report Qiao after all did not yet consider a Chinese permanent representation in Brussels as very interesting and the matter would probably

141 AN, 5 AG 2, 1035, Réunion ministérielle de la Coopération politique, Bruxelles, 16 mars 1973, Rapports entre la Chine et l'Europe, Puaux, Paris, 20 March 1973; PAAA, B21, 200, Zwischenarchiv 108874, Davignon to Berndt, Brussels, 11 January 1973.

89 still take some time.142 This conversation forecasted how the Chinese refused to play the role the member states and the Commission wanted them to, namely to take the initiative in establishing official relations. As the next chapter shows, this led to an unexpected turn of events.

142 PAAA, B37, 341, Zwischenarchiv 100108, Pauls an Bonn AA, Beijing, 21 December 1973.

Delegation of the European Commission to China led by Sir Christopher Soames, May 1975, courtesy of Lord Hannay of Chiswick.

Coup de théâtre (January 1974 – May 1975)

‘ nd so a wonderful process began in which Sir Christopher would get into my red little mini car and we would drive off to the Chinese embassy. We didn't want to go in the official car, because as I said, nobody, absolutely nobody was being told about this. None of the member states were told, none of the Commissioners were told, DGI weren't told, because we all knew if it got out, everyone would start waving their arms around and say “this is all difficult, and we've got to think about it, and is it the right thing to do,” and so on, and he was absolutely determined to do it.’143

Lord Hannay of Chiswick, March 2010

‘Fascinating though it is going to be, I have seldom felt a greater sense of operating totally blind’.144

Sir Christopher Soames, April 1975

‘ nd then knock, knock on the door: "Sir Christopher, you are not leaving yet, and you have sometime left, would it suit you...the Prime Minister would be delighted to see you. He heard that you were here." […] and we went into the Forbidden City.145

Edmund Wellenstein, January 2010

On 4 May 1975, the first day of his visit to China, at a banquet in Beijing given by Ke Bonian, vice-president of the Institute for Foreign Relations, Soames declared in his speech: ‘This visit gives me personally […] and it gives us in the Commission and you in China the opportunity to begin a relationship between China and the European Community which I am convinced will

143 Interview, Lord Hannay of Chiswick, London, 10 March 2010. 144 CA, SOAM 42/1975 China, Soames to MacLehose, 28 April 1975. 145 Interview, Edmund Wellenstein, The Hague, 6 January 2010.

92 prove to be of great and historic significance.’ 146 With these words Soames took the initiative and proposed setting up official relations between the EC and the PRC. The Chinese had left Soames and the five members from his cabinet and DGI, who accompanied him, in complete dark as to the programme of their 7-day stay. 147 But once Soames had made this speech, he met with all the high-ranking Chinese officials: Zhou Enlai, the Vice-Prime

Minister Li Xienian, Qiao Guanhua, Li Jiang, and the Vice-Minister of external trade Ya Ilin. On 6 May Qiao responded positively to the

Commission Vice-President’s offer. Soames, ‘speaking for the Community as a whole as well as for the Commission’, welcomed such a decision adding ‘the question of establishing diplomatic relations could be settled right away without any delay whatsoever’.148 His reassurance that ‘ s far as Taiwan was concerned […] the Community had no official relations’ meant that this meeting de facto sealed the establishment of official EC-PRC relations.149

The puzzle is less the fact that the Community and China set up official relations. In the long term, this would have come about in some way or other.

After all the PRC had shown interest and the Nine had consented in principle.

But the puzzle concerns the agent, the manner and the timing of the event.

The Nine had given clear instructions that the initiative was to be left to the

Chinese, and the Community was only to discreetly encourage matters. The main reason for such circumspection was the risk of jeopardising the

146 CA, SOAM 42/1975 China, Speech by Sir Christopher Soames at a banquet given by Mr. Ko Po-Nien, vice- president of the Insitute for Foreign Relations, Beijing, 4 May 1975. 147 C , SO M 2/1975 China, Schedule ‘ isit to China’, pril 1975. 148 CA, SOAM 42/1975 China, Record of a second meeting between Sir Christopher Soames and the Chinese Foreign Minister Mr. Chiao Kuan-Hua, Beijing, 6 May 1975. 149 Ibid.

93 relationship with the Soviet Union. And initially Soames too adopted the stance that if the Chinese wanted something from the Community, it was up to them to make the move and come to Brussels. But now, not only did

Soames take the initiative to set up relations, but also he literally went out of his way to do so by travelling to Beijing and orchestrated the move in a manner which maximised the coup de théâtre. His visit was anything but discreet even though he was uncertain of the Chinese reaction, and he chose to do so only a few weeks before the opening of stage one of the CSCE in

Helsinki.

So far the literature has remained silent on all this ‘behind-the-stage’ manoeuvring. It has failed to pick up that this episode constitutes a fundamental challenge to inter-governmental supremacy in foreign policy making. The case of China contests ndrew Moravcsik’s claim that ‘European integration resulted from a series of rational choices made by national leaders who consistently pursued economic interests (…) that evolved slowly in response to structural incentives in the global economy.’ 150 The period between January 1974 and May 1975 reveals instead that European integration resulted from choices, that were not all and not necessarily rational. These choices were made by a Commissioner who ultimately pursued political interests. And these interests evolved in response to geopolitics and bureaucratic politics within the Community.

The purpose of this chapter is to investigate the enigma of Soames’ 180° turn around in attitude vis-à-vis China, and analyse the circumstances that

150 Moravcsik Andrew, The Choice for Europe: Social Purpose and State Power from Messina to Maastricht, (Ithaca, New York: Cornell University Press, 1998), p.3.

94 led him to set up official relations in Beijing. It shows that the establishment of official relations was not a foregone conclusion. First the chapter examines why Soames was able to go ahead in the first place. It looks at the member states’ reluctance to follow up with action their pledge to improve relations with China outlined in the Declaration of European Identity. It also looks at how the European Parliament persisted in putting the matter on the agenda of the Council of Ministers and the Commission. It exposes the Commission’s initial lax attitude on the China dossier. Second the chapter turns to the economic factors that facilitated Soames’ change in attitude. Finally it analyses the political dimension. The Chinese hesitated to make a move.

Soames’ prepared his offer for diplomatic relations in utmost secrecy in order to prove the Commission’s capacity for independent action both in international affairs and vis-à-vis the member states. Politics more than economics ultimately shaped Soames’ China initiative.

The member states’ laissez-faire opens wider the window of opportunity

Fundamentally, Soames was able to go as far as he did because the member states let him to do so. The Nine in principle had consented to setting up official EC-PRC relations. Even Ireland, the only member state which did not have diplomatic relations with the PRC, made it clear that it agreed.151 But after their pledge in the Declaration of European Identity the Nine did not

151 European Commission,Eighth General Report on the Activities of the European Communities in 1974, (Brussels: EEC, 1975), p.1; Centres des Archives Contemporaines, Fontainebleau (henceforward CAC), SGCI files, Versement 19880514, Article 96–125, Conseil des Communautés Européennes, Meetings from 3–4 December 1973 to 26 May 1975.

95 press ahead with any Community action to follow up their striking words with Community action. In stark contrast to the European Parliament, they adopted a remarkably passive approach. Neither at the Council of Ministers nor COREPER meetings did EC-China relations feature in a meaningful manner. The Nine simply acknowledged and accepted Soames’ decision to visit China which he announced it on 19 March 1975. Concerning the member states’ reaction, Wellenstein recalls: ‘They were obviously quite fed up, that this had been done behind their backs. Some of them, at any rate I think, hoped that we were going to fall flat on our faces.’152 But there was no overt condemnation of the Commission initiative. The ambassadors in Beijing adopted a dismissive attitude towards the vice-president of the Commission.

gain Hannay’s recollection is that they thought: ‘What does he [Soames] pretend to be? He is nobody. We are the ambassadors, pah. That man always talks about chickens and textile and small stuff.’153 Overall, the member states’ low level of involvement may be explained by several reasons.

The Nine’s attention lay elsewhere. They had to deal with more pressing internal issues such as addressing the economic crisis in Europe characterised by inflation, recession and high unemployment. Hence items that took priority on the EC agenda were monetary cooperation, the regional fund and the Community budget. 154 Regarding external relations, the relations with Greece, Portugal and Spain, the developing countries and

152 Interview, Lord Hannay of Chiswick, London, 10 March 2010. 153 Interview, Edmund Wellenstein, The Hague, 6 January 2010. 154 Ibid.

Eastern Europe took priority.155 The member states had all diplomatically recognised the PRC (except for Ireland), but they had not yet gone very far in developing bilateral political or economic links with the PRC. Therefore, almost uniquely in the history of the Community’s external relations, both the member states and the Community as such developed institutionalised links with China from scratch more or less at the same time. In such circumstances it was easier for the Commission to carve out a role for itself.

For the member states the Community could prove an advantageous vehicle to further their national interest. In the end, France welcomed

Soames’ move in light of Deng Xiaoping’s visit to France in May 1975.156 For

Germany, official EC-PRC relations offered a useful channel to demonstrate to China its interest in liaising, yet to also send the message to the Soviet

Union that the decision was one taken by the Community. German

Chancellor Helmut Schmidt was in favour of coordinating between the Nine on China as a personal letter to French President Valéry Giscard d’Estaing of

26 August 1974 shows.157 But a common European policy towards China could still jeopardise the FRG’s Ostpolitik.158 It is revealing that the German Council

Presidency, which began precisely after the Declaration of European Identity, dropped China from the list of foreign policy issues to be coordinated.

Whereas for the German government the Commission’s move offered a cloak

155 European Commission, Eighth General Report on the Activities of the European Communities in 1974, (Brussels: EEC, 1975), p.1; CAC, SGCI files, Versement 19880514, Article 96–125, Conseil des Communautés européennes, meetings from 3-4 December 1973 to 26 May 1975. 156 AMAE, Série DE-CE, 1967-1975, 1070, Récentes décisions chinoises à l'égard de la Communauté économique européenne, 9 May 1975. 157 AN, 5 AG 3, 933, Message personnel du Chancelier Helmut Schmidt au Président Giscard d'Estaing, Bonn, 26 August 1974. 158 Schaefer, 'Ostpolitik, "Fernostpolitik", and Sino-Soviet Rivalry', pp.136–137, p.146.

97 for decisions which might be unpopular in individual bilateral relations, for

Britain Soames’ initiative was an instance where it could use the Community to give its foreign policy more weight. Once the FCO knew of Soames’ visit, they backed him and eventually supported the preparations for his visit with background briefing material in order to make it a success.159 Considering the unpredictability the Europeans experienced in their dealings with the

Chinese authorities, it was not at all impossible that the Commission would fail to set up Community relations with China.160 In that case the Commission would take the blame. If the Commission however was successful, the Nine were confident of being able to keep control of the Commission’s ambitions and even take over its role – if deemed opportune. And at this point the relationship was mainly about symbolism.

In stark contrast to the member states’ passive attitude and Soames’ initial reluctance stood the activity of the European Parliament. It was the EP which persisted after the Copenhagen Summit in putting the issue of the

Community setting up official ties with China on the agenda of the Council of

Ministers and the Commission. Oral questions on 9 July 1974 by British

Conservative Arthur Douglas Dodds-Parker and German Christian Democrat

Hans-Edgar Jahn, and on 12 September 1974 by the British MEP Charles

O’Hagan, non-attached, illustrate how the European Parliament repeatedly inquired what steps the Council and the Commission were taking to improve relations with the PRC. 161 Jahn requested an explicit answer from the

159 FCO 21/139/127, Sir C Soames’ visit to China, Fergusson to Braithwaite, 7 pril 1975. 160 FCO 21/1097, Permanent Under-Secretary’s Planning Committee, 8 March 1973. 161 For example: CMA, Intermediate Archive, 040284, Oral Question, Dodds-Parker to Commission of the European Communities, and Oral Question, Jahn to Commission of the European Communities, 9 July 1974; ECHA,

Commission when he asked: ‘La RPC a-t-elle fait comprendre à la

Commission qu'elle était disposée à reconnaitre la CEE? Des pourparlers en ce sens ont-ils d jà eu lieu ou non?’162 And Glinne wanted to know on 23

January 1975:

‘Bearing in mind the position adopted at the last Paris Summit regarding political cooperation, I should like to know whether the Council has taken any recent steps towards establishing direct bilateral diplomatic relations at a high level between the Community and the People’s Republic of China. What have been the results to date?’163

The EP continued to put pressure on the Council and the Commission to justify their lack of action. It pushed the Community as such to improve the relationship with China. Yet the European Parliament’s pressure was unlikely to have decisively changed Soames’ attitude.

Back in February 1973, in a draft response to the European Parliament,

Soames had made clear: ‘The Community has been recognised to date by about 100 countries. For none of these countries particular steps have been taken. Hence, there is no reason to change this general rule [for China]’.164

Likewise in April 1973, Soames briefed Ronald Grierson, Managing Director of the London-based investment bank S.G. Warburg, before his meeting with

Bank of China representatives. He emphasised that Grierson should comment on the Commission’s favourable attitude towards closer relations:

B C 71/200 /92, Written Question No. 3 0/7 , Mr. O’Hagan to the Commission of the European Communities, 12 September 1974. 162 CMA, Intermediate Archive, 040284, Oral Question, Dodds-Parker to the Commission of the European Communities, and Oral Question, Jahn to the Commission of the European Communities, 9 July 1974. 163 NA, FCO 21/1390, Draft reply to Written Question No. 687/74, Council, 29 January 1975. 164 ECHA, BAC 48/1984/687, Schéma de réponse à la Question Orale No. 30/72, DGXI B/5 to Soames, Brussels, 7 February 1973.

‘If they raise it, but only if they do (for it is important we do not appear to be running after them).’165 Soames’ tone was even stronger in a confidential note to former Prime Minister Edward Heath in May 1974:

‘We are not panting for recognition by China. We are perfectly ready for them to work up their relationship with the Commission without going through the business of accrediting an ambassador but simply by increasing and raising the level of their contacts.’166

Likewise, the Commission’s programme for 197 did not even consider China under the heading of Europe’s external personality. 167 Concerning the increase in the Community’s external representation in 1975, DG I regarded the opening of representations in Peru and Canada as more important than establishing one in China.168

Therefore the Declaration of European Identity was a milestone, but it did not prove a turning point in the Community’s opening to the PRC. The member states quickly reverted to their hands-off approach. It was this passivity which eventually gave Soames the room for manoeuvre to launch his own China initiative. The European Parliament continued to act as the one EC institution which advocated an active EC China policy. Notably, until the end of 197 , the Commission under Soames’ leadership did not consider actively seeking out the Chinese either.

165 ECHA, BAC 136/1987/628, China, Ronald Grierson, to Soames, Brussels, 3 May 1973. 166 ECHA, BAC 136/1987/628, China and Europe, Soames to Heath, 17 May 1974. 167 European Commission, Seventh General Report on the Activities of the European Communities in 1973, (Brussels: EEC, 1974), p.1. 168 ECH , B C 3/1978/1511, Communication ‘Renforcement de la Repr sentation Ext rieure en 1975’, Soames to Members of the Commission, Brussels, 18 July 1974.

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Trade prospects helped, but did not determine the outcome

The fact that economic benefits outweighed the risks of setting up official relations with the PRC facilitated Soames’ change in attitude, but they did not decide it. Soames’ decision came in the climate of economic crisis. In preparation for the European Council meeting in Dublin the Commission summed up the situation:

‘Pour la Communaut , l’ann e 197 a t la plus difficile de son existence. Le taux d’inflation et le niveau du chômage n’ont jamais été aussi élevés. Les disparités entre pays membres se sont accentu es. Il n’a pas encore t possible de d gager une politique commune de l’ nergie’.169

The crisis dramatically exposed the EC’s structural problems. The

Community depended on imports of raw materials. In 1972 primary products accounted for more than half the total EC imports and 91% of its imports came from developing countries.170 The oil-crisis had made it blatantly clear that the EC had to diversify its raw material suppliers.171 Therefore it was not a surprise that the EC particularly watched Japan’s ability to import oil from the PRC. 172 Learning from the American, Spanish and Greek experiences, official relations with the PRC could make it easier to realise at least some of

169 ECHA, BAC 259.80, PVS 329-332, COM(75) 80 final, La situation économique de la Communauté au début de 1975, Communication de la Commission en vue de la préparation du 'Conseil européen'- Dublin, 10/11 mars 1975, Commission des Communautés européennes, Sécrétariat général, Brussels, 26 February 1975. 170 European Commission, Seventh General Report on the Activities of the European Communities in 1973, (Brussels: EEC, 1974), pp.xvi–xviii. 171 Ibid., pp.xvi–xviii. 172 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des Conseillers Commerciaux (2ème Rapport), 26 March 1974; CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (4ème rapport), 3 April 1975.

101 the trade opportunities latent in China, and thereby address an internal crisis.173

The global economic crisis meant that competition amongst industrialised countries for new markets like China had grown fiercer. 174

Whereas the United States, Australia and Canada were primarily competitors for agricultural exports to the PRC, Japan, China’s largest trading partner in

1973, was a rival with its exports of machinery, industrial plant, steel and chemical products.175 Therefore the Community had to shore up its ‘power to compete’ as ice-President of the Commission Carlo Scarascia Mugozza set out to the European Parliament on 12 February 1974. If the EC engaged with

China, the chances of success were further helped by the fact that unlike

Japan, the United States or Australia, the Community did not have official relations with Taiwan – a very sensitive topic for the Chinese leadership.176

The Community could prove a useful vehicle to take on the international economic competition more effectively, which was precisely what

173 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974. 174 ECHA, BAC 3/1978/151, Aufzeichnung zu dem Vorschlag der Generaldirektion Außenbeziehungen zu einem Studienauftrag über das Thema "Die Auswirkungen der Jüngsten Entwicklungen der Internationalen Rohstoffmärkte auf die Politiken der Gemeinschaft", 24 January 1974. 175 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (2ème Rapport), 26 March 1974; CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (4ème rapport), 3 April 1975. 176 Ibid.; ECHA, BAC 136/1987/628, Soames to Heath, 17 May 1974.

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Washington became wary of. 177 China offered the Commission the opportunity to prove itself against the international competition.178

Certainly one risk was that the Community might appear less reliable to traditional partners from Africa and South-East-Asia – often connected by former colonial ties to individual member states. Countries such as Vietnam and India might react negatively to the Commission welcoming new competition from China, which setting up official relations was likely to enhance. 179 As a consequence, these partners could withdraw from the EC market, cutting off the Community from essential raw materials, and falling back upon bilateral negotiations with the member states. Such a reaction would weaken the Commission’s authority. But if the Commission managed to conclude a trade agreement with the Chinese following the establishment of diplomatic relations, the Commission would further demonstrate its capacity to act in the name of the Community. So far the Commission’s authority in the international economy had only been acknowledged within the GATT after the successful Kennedy Round.180

more serious gamble related to the Community’s trade relations with the Soviet bloc. The Commission sought to prove that it was diplomatic player with whom to conduct business irrespective of ideological difference.

177 Geir Lundestad, Empire by Integration: the United States and European integration, 1945-1997, (Oxford: Oxford University Press, 1998), pp.97–98. 178 European Commission, Seventh General Report on the Activities of the European Communities in 1973, (Brussels: EEC, 1974), p.xviii. 179 ECH , B C 136/1987, Note ‘La Chine et les matières premières’, DGI ID to Soames, 25 pril 1975. 180 Coppolaro, 'The European Economic Community in the GATT Negotiations of the Kennedy Round (1964-1967)', pp.355–362; ———, 'Trade and Politics across the Atlantic: the European Economic Community (EEC) and the United States of America in the GATT Negotiations of the Kennedy Round (1962-1967)', European University Institute, 2006; Thomas Zeiler, American Trade and Power in the 1960s, (New York: Columbia University, 1992), pp.244–245.

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Such an aim was reflected not least in the negotiations for the Second Basket at the CSCE.181 This ‘basket’ or chapter encompassed guidelines and concrete recommendations aimed at increasing cooperation in the fields of economics, science and technology between the participants – the Western and Eastern

European states, the Soviet Union and the United States. It was precisely on this Second Basket that the Commission had secured its participation in the

CSCE and contributed with its expertise. After the expiration of bilateral agreements on 1 January 1975, the Eastern bloc made no attempt to revive trade with the EC.182 It did not respond to the Commission’s so-called Outline

Agreement. This was the draft the Commission had forwarded to the state trading countries in November 1974 to replace all national, bilateral agreements on 1 January 1975 as a step towards the implementation of the

Common Commercial Policy. Since none of the state trading countries recognised the Community, DG I had to be creative in finding ways to communicating with them:

‘And some of these people did not have an address. And some of these people you could not visit. For instance, I think it was the Mongols who were in Paris. They had an embassy, but it was a wall with a little door in it which you could never pass. So we threw the envelope over the wall. So everybody now knows in the outside world, that if they have the wish to talk about trade, here this is the address, here that’s our names, here this is our approach, we welcome you. Of course, nobody answered. But they all got our messages.’183

181 Romano, From Détente in Europe to European Détente, pp.40–46. 182 ECHA, BAC 259.80, PV 309, 2e partie, 24 September 1974; European Commission, Ninth General Report on the Activities of the European Communities in 1975, (Brussels: EEC, 1976), p.xxviii. 183 Interview, Edmund Wellenstein, The Hague, 6 January 2010.

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As Soames told Qiao in Beijing, the Eastern bloc ‘did not wish to recognise the reality of the common commercial policy’.184 Playing on the

Sino-Soviet competition, the Commission could use enhanced relations with the PRC as a lever in the trade negotiations with the Eastern bloc.185 The gamble was delicate because the Commission had to present the enhanced relationship to China not as a threat but as an incentive for the other state trading countries to reply to the Outline Agreement.186

But Soames did not initiate official relations simply to upgrade the

Community’s trade relations with the PRC. First, the Commercial Counsellor

Reports and the Commission’s internal deliberations show that expectations of realising the trade potential remained sober. Several reasons accounted for this. The European analyses of the Chinese economy were based only on estimates because the PRC did not publish official data and those available proved limited in their reliability. The Chinese trade policy changed rapidly according to the PRC’s needs which meant that the government arbitrarily cut off supplies to European traders. Although China had substantial raw material resources, the development of these needed equipment, which the

Chinese were unable to finance because the government refused to accept foreign credits.187 bove all, China’s fourth Five-Year Plan had re-affirmed the

184 CAC, SOAM 42/1975/China, Record of a Meeting between Sir Christopher Soames and the Chinese Foreign Minister, Mr Chiao Kuan-Hua, 5 May 1975. 185 See ECHA, Speech collection, Soames, Discours prononcé le lundi 5 février 1973 au Guildhall de Londres devant l’association des Overseas Bankers. 186 NA, FCO 21/1097, Permanent Under-Secretary’s Planning Committee, 8 March 1973. 187 ECHA, BAC 136/1987/624, Report on visit to Copenhagen and London, China: interviews with leading companies in the China trade, Maslen and Westerby, 30 April 1975.

105 aim of achieving autarky.188 Soames admitted to Heath in May 197 : ‘in fact

Chinese trade with Western Europe is, and is likely to remain, very limited’.189

Second, the Chinese authorities had not given any guarantee that official relations would lead in any foreseeable time to a trade agreement.190

The Chinese were the ones who called the shots as Emanuele Gazzo, the first director of Agence Europe, reflected in an article of 10 January 1974.191 His analysis of the Chinese policy was shared in the European decision-making corridors. The British Permanent Undersecretary’s Planning Committee for example had remarked: ‘Despite the prospects for trade and even industrial cooperation, the Chinese will stop well short of dependence on Western

Europe. […] and in any case the tone will always be set by the Chinese’.192

Third, even if China opened its doors, it was doubtful whether the member states would be able to overcome their national competition and agree on a Common Commercial Policy. The resistance to any such coordination regarding EC imports of raw materials from the PRC is illustrated in a briefing to Soames before his China visit: ‘Finalement il ne

188 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (2ème Rapport), 26 March 1974; CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (4ème rapport), 3 April 1975; PAAA, B201/411/433, Verhältnis EG-VR China, 411- 423-CHN, 8 November 1973; ECHA, BAC 136/1987/628, Soames to Heath, 17 May 1974; ECHA, BAC 136/1987/624, Interviews with Leading Companies in the China Trade, Maslen and Westerby, 30 April 1975; ECHA, BAC 136/1987, La Chine et les Matières Premières, DGI ID4 to Soames, 25 April 1975. 189 ECHA, BAC 136/1987/628, Soames to Heath, 17 May 1974. 190 ECHA, BAC 136/1987/628, Hannay to Soames, 27 November 1974; NA, FCO 21/1390, Voyage en Chine, Klein, 8 April 1975; CA, SOAM 42/1975 China, Record of a meeting between Sir Christopher Soames and the Chinese Foreign Minister Mr. Chiao Kuan-Hua, Beijing, 5 May 1975. 191 ECHA, BAC 136/1987/628, Agence Europe No. 1432, Gazzo, 10 January 1974. 192 NA, FCO 21/1097/292, Permanent Under-Secretary’s Planning Committee, The external relations of the European Community: relations with non-European Communist countries, 8 March 1973.

106 faut pas perdre de vue que la Communaut n’est pas encore en mesure de définir de façon cohérente ses besoins et sa politique dans ce domaine.’ 193

Therefore it was far from certain that the Nine would agree to the

Commission concluding a Community trade agreement with China in the first place.

Setting up official relations with the PRC offered Soames a way that allowed him to be seen as addressing the economic crisis in Europe and to shore up the Community’s ability to compete in the international economy, and gain leverage for trade negotiations with the Soviet bloc. But the economic reasons alone did not prove decisive enough to provoke Soames into turning 180° in attitude. It is hence essential to examine the political factors behind the move more closely.

Beliefs, personal ambitions, and politics

Beijing’s hesitancy, geopolitics, intra-Community politics, personal ambitions and beliefs all came together in Soames’ China initiative. The Commission continuously struggled to assert itself in the 1970s. This is illustrated in the first enlargement negotiations from 1970 to 1973. The Nine insisted on bilateral negotiations rather than allowing the Commission to coordinate them, and the Council of Ministers eventually was in charge of the negotiations.194 The enlargement negotiations with Greece proved similarly

193 ECH , B C 136/1987, Note ‘La Chine et les Matières Premières’, DGI ID to Soames, 25 April 1975. 194 See for example: Jan van der Harst Jan, 'Enlargement: the Commission Seeks a Role for Itself', in Michel Dumoulin and Marie-Thérèse Bitsch (eds.), The European Commission, 1958-72: History and Memories, (Luxembourg: Office for Official Publications of the European Communities, 2007), pp.533–556.

107 challenging.195 During a dinner with the EC Heads of State and Government at the Elysée in September 1974 that set the groundwork for the creation of the European Council, Wilson noted: ‘Helmut Schmidt’s attack was very strong, characterising the Commission as bureaucratic, too costly and over staffed’.196 Further Wilson noted: ‘I said we would like the Council to do more work of this kind [cooperation over Cyprus], separate from the

Commission’. 197 Responding to such criticism, Ortoli attested before the

European Parliament in February 1975: ‘In the next two years, the

Commission’s political mission will once again occupy a major place in its work’.198 An engaged role in improving relations with China was precisely a way for the Commission to follow up in action its pledge to have political staying-power.

Soames made any number of efforts to demonstrate the Community’s goodwill to the PRC’s representatives, and to get the Chinese to set up official relations. In his view:

‘It has been clear throughout this period of lively Chinese interest in Western Europe that it was basically political and not economic. To China Western European unity has been attractive not because it offers better market or trading conditions […] but rather as an element in China’s rivalry with Russia and to a lesser extent, with the US. A constant theme in Chinese leaders’ contacts with European leaders has been the need to treat détente with great circumspection and to sup with the Russians, if at all, with a very long spoon.’199

195 Karamouzi, Greece, the EEC and the Cold War 1974-1979. 196 NA, PREM 16/78, Impressions of the Discussions at the Meeting of EEC Heads of State of Government, Wilson, 16 September 1974. 197 Ibid. 198 ECHA, Discours Ortoli, Presentation of the General Report for 1974 and Programme of the Commission for 1975, 18 February 1975; see also Badel and Bussière, Francois -Xavier Ortoli, pp.132–149. 199 ECHA, BAC 136/1987/628, China and Europe, Soames to Heath, 17 May 1974. .

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Based on this analysis Soames played upon the Sino-Soviet competition. He made a point about treating the Chinese more favourably than the Soviets and other Eastern European state trading countries. Soames wanted to transmit the Outline Agreement in person to the Chinese ambassador to

Belgium Li Lianpi in November 1974, rather than only via post as had been the case with the other state trading countries. 200 He also arranged meetings with Li Lianpi in which he emphasised that the Community distinguished the

PRC government from the other Communist ones. 201

Yet the Chinese remained cautious: Beijing continued to express its interest in official relations, but would not go further than that. 202 Returning from Beijing on 6 January 1975, the Dutch Foreign Minister Max van der

Stoel reported that Beijing wanted to establish permanent contacts with the

Community. Likewise in April 1975 Zhou Enlai indicated to the Belgian Prime

Minister Leo Tindemans during his official visit to China that the PRC considered sending an ambassador to the Community. 203 But no concrete moves followed. The caution of the PRC is illustrated not least by the fact that the Institute for Foreign Relations of the PRC rather than the Ministry for

Foreign Affairs invited Soames.204 And initially the invitation was only an unofficial one. Only at Soames’ insistence did this change. Soames still confided one week before his visit in a personal letter to Murray MacLehose,

200 ECHA, BAC 136/1987/628, Hannay to Soames, Tea with the Chinese ambassador HE Mr Li Lien-pi, 27 November 1974. 201 Ibid. 202 ECHA, BAC/1987/624, telex nr. 358, Luyten to Soames cabinet, 4 December 1974; see also Kapur, China and the E.E.C., p.35; Schaefer, "Ostpolitik, "Fernostpolitik"", pp.145–146. 203 ECHA, BAC 48/1984/687, Information relation extérieures, La Republique populaire de Chine et la Communauté européenne. 204 CA, SOAM 42/1975 China, Press notice, Hannay, 18 March 1975.

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British Governor of Hong Kong: ‘Fascinating though it is going to be, I have seldom felt a greater sense of operating totally blind’.205 It became clear that if

Soames had plans for the Chinese he had to take things in his own hands.

And a visit from 4 to 11 May proved an opportune time in relation to the

Chinese since Deng Xiaoping was to visit France from 12 to 17 May and

Soames visit would be seen in a positive light.

Engaging directly with the Chinese government was a case where

Soames could demonstrate that Commission did not merely react in an ineffective manner to exceptional crises in world politics such as the Yom

Kippur war in October 1973 or the Turkish invasion of Cyprus in July 1974.206

A strong diplomatic act would show that the Commission could take the initiative in international relations that were not characterised by armed confrontation, and through regular diplomatic exchange. Certainly the general EC-PRC relationship was one where it was usually the Chinese who set the pace, and the EC officials were conscious of this. 207 But in this particular instance a Commissioner could and did take the initiative.208

205 CA, SOAM 42/1975 China, Soames to MacLehose, 28 April 1975. 206 European Commission, Seventh General Report on the Activities of the European Communities in 1973, (Brussels: EEC, 1974), p.xvi; European Commission, Eighth General Report on the Activities of the European Communities in 1974, (Brussels: EEC, 1975), p.249. 207 ECHA, BAC 136/1987/628, Agence Europe No. 1432, Gazzo, 10 January 1974; CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (2ème Rapport), 26 March 1974; CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économique européenne en République populaire de Chine (4ème rapport), 3 April 1975, 3 April 1975; Compare: FCO 21/1097, Permanent Under-Secretary’s Planning Committee, 8 March 1973. 208 ECHA, BAC 136/1987/628, Soames to Heath, 17 May 1974; see also: Kapur, China and the European Economic Community, pp.31–33.

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Geopolitics was key. nd so was Soames’ world view. He ‘just believed that the European Community needed to have relations with China. He shared the view also that China was a piece on the chess-board of the Cold

War. And he was after all a child of the Cold War himself.’209 Soames’ move fitted with the European endeavour to challenge superpower détente. This concept of détente was meant to relax East-West tension by consolidating a bipolar international system managed by the United States and the Soviet

Union. The EC-PRC connection meant strengthening the Community’s capacity as a ‘Third Force’.210 This idea had different meanings at different times for different actors.211 Applied to the mid-1970s, ‘Third Force’ referred to the Community’s aim that European d tente would overcome rather than consolidate the bipolar Cold War order, and advance the Community’s independence as an international actor in its own right.212 Indeed, Soames declared to his Chinese hosts on 4 May 1975 that: ‘We do not believe that the world’s problems can or should be resolved only by the action of the two superpowers, and we believe it important that Europe should speak with a single voice in its dealing with them.’213 Beijing offered political legitimacy to the Commission which would join with it in challenging the bipolar system.214

209 Interview, Lord Hannay of Chiswick, London, 10 March 2010. 210 See for example: Loth, Overcoming the Cold War, p.viii; Ebinger, 'The Politics of Potential', p.320. 211 Walter Lipgens and Wilfried Loth, Documents on the History of European Integration. The Struggle for European Union by Political Parties and Pressure Groups in Western European Countries 1945-1950, (Berlin: de Gruyter, 1988), pp.4–8. 212 See for example: ngela Romano, 'Western Europe’s Self-assertion towards the Superpowers: the CSCE Chance and its Aftermaths', in Anne Deighton and Gérard Bossuat (eds.), The EC/EU: a World Security Actor ?, (Paris: Soleb, 2007, pp.152–169; Antonio Varsori, 'Crisis and Stabilization in Southern Europe during the 1970s: Western Strategy, European Instruments', Journal of European Integration History, 15, no. 3, 2009. 213 CA, SOAM 42/1975 China, Speech by Sir Christopher Soames at a banquet given by Mr. Ko Po-Nien, vice- president of the Insitute for Foreign Relations, Beijing, 4 May 1975. 214 Ebinger, 'The Politics of Potential', p.201.

111

The vice-president’s move matched the Commission’s agenda set out by

Ortoli in front of the European Parliament on 18 February 1975:

‘Our first objective must be to make Europe less dependent. […] Europe offers us an opportunity of exercising to the full the modicum of power allowed us in the new centres of decision. […] It holds good for international organisations and for our relations with our larger partners, notably the US’.215

Official relations with China meant that the Community linked up with a country that encouraged European integration as a counterweight to the

United States.216 In May 1975, Soames commented sharply to Qiao Guanhua on Kissinger’s misguided approach, which his speech for the Year of Europe epitomised.217 By opening to China, the Community could also present itself as more skilful than Washington which had failed to follow up Nixon’s spectacular visit with the establishment of formal diplomatic ties and would in fact set up diplomatic relations with Beijing only five years after the

European Community in 1979.

But most important of all was the Community’s relationship with the

Soviet Union. It was a considerable risk for the Commission to reach out actively to the PRC because it could nurture the Soviet fear of geo-strategic encirclement.218 Soames’ cabinet exercised significant caution and control on the Commission’s relations to China. This is illustrated in a response by

Hannay in October 1974 regarding Delbos, a member of the Directorate

215 ECHA, Discours Ortoli, Presentation of the General Report for 1974 and Programme of the Commission for 1975, 18 February 1975. 216 Soames was informed: ECH , B C 136/1987, China and the E.C., Ernst to Soames’ cabinet, pril 1975. 217 CA, SOAM 42/1975 China, Record of a meeting between Sir Christopher Soames and the Chinese Foreign Minister Mr. Chiao Kuan-Hua, Beijing, 5 May 1975. 218 For an analysis of the Community objectives at the CSCE see: Romano, From Détente in Europe to European Détente. On the Soviet fears of encirclement see: ibid., pp.83–88.

112

General Human Resource and Administration who wished to visit the PRC with other Commission officials. Hannay remarked:

‘where I have very real doubts is over the evident intention of Mr Delbos to get some kind of political coverage for this visit. The vision of some 20 Commission officials selected at random going off to China with the idea of opening up a new chapter in Sino/European relations is not a comforting one’.219

Soames’ timing of his visit, a few weeks before the Helsinki Summit of the

CSCE in July 1975 points to Soames playing the China card.

At the CSCE a central objective of the Community was to gain Soviet recognition as a unified political actor.220 Reaching out politically to the PRC in May 1975 suggests that Soames aimed to set the tone in Helsinki. The

Commission’s aim was to isolate the Soviet Union, leaving it as the only blank spot on the world map which had not yet engaged officially with the EC. 221 On

16 September 1974, the COMECON Secretary Fadeyev sent a letter to Ortoli requesting preliminary talks between the Commission and COMECON.222 But when Wellenstein visited Moscow in February 1975 for the first official talks with COMECON a rapprochement was not in sight. His judgement was devastating. He reported back to the Nine:

‘Nos interlocuteurs n' taient pas pr par s le plus grand d sordre régnait de leur coté. Conciliabules, chuchotements. Tout cela était enfantin et primitif. […] L'atmosphère était celle d'une "mad house". Il est difficile de concevoir le degré de confusion, de basse qualité, de stupidité auquel nous avons été confrontés. Le mot de médiocrité serait un compliment. Il s'agit plutôt de stupidité et de

219 ECHA, BAC 48/1984/686, Hannay to Wellenstein, 11 October 1974. 220 Romano, From Détente in Europe to European Détente, p.81. 221 Interview, Edmund Wellenstein, The Hague, 6 January 2010; See also, NA, FCO 30/1282, China and the Community, Tickell to Mason, 15 May 1972; NA, FCO 40/460, The external relations of the European Community, Permanent Under-Secretary’s Planning Committee, 22 March 1973. 222 Kansikas, 'Trade Blocs and the Cold War', p.196.

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totale inorganisation. […] Notre impression est désastreuse: inaptitude et confusion. […] D'après M. KAWAN (qui prend la parole), la mauvaise foi de ses interlocuteurs semble en effet avoir dépassé les bornes. […] Il a t impossible de s'entendre.’223

The meeting had shown that the Soviet Union and COMECON were not prepared to acknowledge the Commission’s jurisdiction over trade policy. In this context, Soames’ China initiative was a diplomatic coup that was meant to signal to the Soviets and COMECON that they could no longer afford to ignore the Commission and the reality of the European Community. For the

Commission, the move dramatically showed that it was a diplomatic actor, that could bridge ideological differences, speak for the European Community, and was hence not to be ignored. The significance was ‘Political, because we were everywhere in the world. And until then, there were two enormous blank spots. That was Eastern Europe and China and surroundings,

Mongolia. There were enormous blank spots, we had no access. Now we were everywhere, except, still, Moscow.’224

The timing of Soames’ visit hints at a further factor in his decision: it was one month before the British referendum on EC membership.225 The referendum meant that public opinion in the UK debated the Community’s value, and that discussions on the issue pervaded the Community institutions

223 AMAE, Série DE-CE, 1967-1975, 1064, Relations CEE-CAEM, Compte rendu établi par notre Ambassade en URSS des remarques faites aux Ambassadeurs des Neuf à Moscou par M. Wellenstein, Directeur général des Relations Exterieures à la Commission des Communautés Europénnes au sujet de ses entretiens avec des représentants du Secrétariat du CAEM, 21 February 1975. 224 Interview, Edmund Wellenstein, The Hague, 6 January 2010. 225 On the referendum see for example: Philipp Goodheart, Full-Hearted Consent: The Story of the Referendum Campaign, (London: Davis-Poynter, 1976); David Butler and Uwe Kitzinger, The 1975 Referendum, (London: Macmillan, 1976).

114 and also the activities’ of DG I.226 Hence the Commission gladly grasped any public opportunity to assert its political role and to demonstrate the relevance of the EC as such. Considering the large press coverage that foreign relations with China attracted, the Commission’s visit to Beijing represented such an opportunity. The Commission could also prove it took the advice of

European business circles seriously. In April 1975 John Maslen, adviser for

Relations with State Trading Countries at DG I of the European Commission, interviewed leading companies involved in trade with the PRC during a visit to London. 227 They anticipated that the member states would gain increased value as individual trading partners with China in the event of official EC-

PRC relations being established. Therefore Soames’ China initiative demonstrated that the Commission spoke for a Community which actively addressed national concerns.228 This too would be helpful in the context of the

British referendum campaign – a campaign with which Soames would be actively involved.

The timing and manner in which he accepted the Chinese invitation and announced it to the member states offers an important indication that his change of mind also related to important institutional changes, namely the creation of the European Council. The European Council, created at the Paris

226 John Young, 'Europe', in Anthony Seldon and Kevin Hickson (eds.), New Labour, Old Labour, (London and New York: Routledge, 2004); Young, Britain and European Unity, pp.111–120; see also for example: ECHA, Speech collection, Soames, to the Conservative Political Centre Symposium on “Our First Year in Europe”, The Royal Festival Hall, 26 January 1974; ECHA, Speech collection, Ortoli, Presentation of the General Report for 1974 and programme of the Commission for 1975, 18 February 1975; CA, SOAM 42/1975 China, Record of a meeting between Sir Christopher Soames and the Chinese Foreign Minister Mr. Chiao Kuan-Hua, Beijing, 5 May 1975. 227 ECHA, BAC 136/1987/624, Interviews with Leading Companies in the China Trade, Maslen and Westerby, 30 April 1975. 228 See for example: C , SO M 2/1975 China, Bulletin d’Information n°9 , Commission des Communaut s européennes, Groupe du Porte-Parole, quoting Reuter, 7 May 1975.

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Summit in December 1974, represented a major institutional innovation because it de facto defined the Heads of States and Governments as the ultimate decision-making body within the EC.229 The European Council was to meet regularly to provide leadership to the EC in times of economic and political crisis such as the mid-1970s.230 It was uncertain what this innovation would mean for the Commission. Ortoli addressed the European Parliament in February 1975. He warned that the European Council might lead to ‘the low road of inter-governmental cooperation when we should be taking the high road of integration’.231 Therefore a possibility was that this new body would abrogate the Commission’s traditionally held position with regard to the Community’s external relations.232

To counter that and assert the Commission’s role in the conduct of the

Community’s external relations, Soames changed his attitude towards the

PRC in early 1975: rather than waiting for the Chinese to come to Brussels and take matters further, Soames headed to Beijing and staged a political act making a point to speak in the name of the European Community and its member states. As the opening quote of this chapter suggests, Soames held a series of secret meetings with Li Lianpi where he ‘sat and drank tea and ate little cakes and gradually the idea of the visit took shape’.233 He accepted the invitation without the knowledge of the Nine on 4 March 1975, just one week

229 Ifestos, European Political Cooperation, p.186; Ludlow, 'From Deadlock to Dynamism', p.227. 230 Michèle Weinachter, 'Le Tandem Valéry Giscard d'Estaing - Helmut Schmidt et la gouvernance européenne', in Wilfried Loth (ed.), La Gouvernance supranationale dans la construction européenne, (Bruxelles: Bruylant, 2005), pp.208–209; Gillingham, European Integration, 1950-2003, p.81. 231 ECHA, Speech collection, Ortoli, Presentation of the General Report for 1974 and Programme of the Commission for 1975, 18 February 1975. 232 Serge Berstein and Jean-Francois Sirinelli (eds.), Les Années iscard: Valéry iscard d’Estaing et l’Europe, 1974-1981, (Paris: A.Colin, 2005), p.141; Badel and Bussière, Francois -Xavier Ortoli, pp.153-156. 233 Interview, Lord Hannay of Chiswick, London, 10 March 2010.

116 before the first meeting of the European Council in Dublin. To reduce the risk of the Nine’s obstruction, he informed the national representatives about his decision only on 19 March and only after a leak to the press and merely over a low-key COREPER lunch: 234 ‘he told the permanent representatives that he was going to China, didn't ask them if it was a good idea, or a good thing to do, or anything, but just said “I'm going”’.235 Soames confronted the Nine with a fait accompli.

ll in all, Soames’ China initiative was rooted in his world view and personal ambitions. Geopolitics and intra-Community politics allowed

Soames to act upon on these and take the lead regarding the People’s

Republic. It was to prove to both superpowers and to the Nine that the

Commission was a political authority to be reckoned with. The timing which

Soames’ chose to visit China and announce this to the member states suggests that he changed his mind at the beginning of 1975 as a number of factors came together. It became clear that the Chinese were not to going to step forward and take the initiative of setting up official relations. The

Chinese were in control of the timing of the visit. But it is realistic to assume that at the secret meetings in the Chinese embassy in Brussels, discussing over tea and cake, Soames convinced the Chinese that May was the most opportune time for both parties.

First, Deng Xiaoping was to visit France in May which enhanced the chances for the Chinese to respond positively to Soames’ proposal. Second,

Wellenstein’s visit to Moscow in February had proven disastrous. In the light

234 PAAA, B201/411, Reise VP Soames nach Peking, Lebsanft to Bonn AA, 21 March 1975. 235 Interview, Lord Hannay of Chiswick, London, 10 March 2010.

117 of the impending Helsinki Summit Beijing offered the Commission diplomatic leverage against the Soviets. And Soames played the Soviet card vis-à-vis the Chinese. Third, Britain was scheduled to vote in a referendum on

EC membership in June, when Soames would be fully engaged campaigning in the UK. The Commission was eager to prove the Community’s worth, as were the Chinese as a counterweight to the Soviet Union. Lastly, the

European Council held its first session in April. It was uncertain where in the institutional power structures that would leave the Commission, and consequently what would come of the established contact with the Chinese.

Soames announcement of his visit as a fait accompli to the member states just one week before the European Council meeting amounted to a statement about the Commission’s sense of purpose. So did his visit in May.

Conclusion

The episode reveals elements of independent policy decision-making on behalf of the EC, and an assertion of new loci of political power which the national governments had to come to terms with as fait accompli. Despite the

Declaration of European Identity, the rapid establishment of official EC-PRC relations was not a foregone conclusion. The member states quickly reverted to their hands-off approach after the Copenhagen summit. They did not follow up their pledge with action. The Heads of State and Government did not involve themselves directly in setting up official EC-PRC relations. And the Chinese government refused to play by the member states’ game, which assigned to Beijing the role of the initiator of official relations with the

Community. Soames was primarily responsible for setting up the official EC-

PRC relationship.

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In the context of the economic crisis, the fact that the PRC held the potential to complement the EC economy facilitated Soames’ decision to move beyond his initial opposition to taking the initiative vis-à-vis Beijing.

But the main factor behind his decision was inter-institutional jockeying for power. Soames used China as diplomatic leverage outside superpower politics to bolster the Commission’s role. t the root of this bold move, unprecedented in the Community’s history, stood personal ambitions fuelled by his friendship with Kissinger, and his belief that the European Community mattered in the Cold War.

A central question is the relevance of China for the EC between 1973 and

1975. After all, the PRC was geographically far removed with marginal influence on European citizens’ everyday life. rchival evidence also shows that the PRC did not feature as a priority on the member states’ agenda in that period. But not only did relations with China prove uniquely different to any of the Community’s other external relations, but also EC relations with the PRC in that period linked to major issues on the agenda of national governments and the Community: tackling the economic crisis and seeking détente in Europe. Most revealingly however, the establishment of official

EC-PRC relations became intertwined with essential questions of both EC membership and institutional changes within the EC. After Walter Hallstein had failed to assume greater power for the Commission in the mid-1960s, which led to a period of institutional pessimism, the Commission sought to redefine its aspirations for political leadership.236

236 Badel and Bussière, Francois -Xavier Ortoli, p.121 and p.127.

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Soames acted upon these aspirations – albeit on an issue where member states interests converged.237 His initiative on 4 May 1975 was a landmark in the Community’s opening to the PRC. s a result of Soames’ move, Qiao expressed ‘in straightforward language that the People’s Republic of China wanted to establish relations with the Community and was prepared to send a representative to it.’238 Now the challenge was to move the relationship from declarations and symbolism to concrete results.

237 Ludlow, The European Community and the Crises of the 1960s, p.209; ———, 'A Supranational Icarus? Hallstein, the Early Commission and the Search for an Independent Role', in Antonio Varsori (ed.), Inside the European Community. Actors and Policies in the European Integration 1957-1972, 37-54, (Baden-Baden, Bruxelles: Nomos, Bruylant, 2006); Wilfried Loth, William Wallace and Wolfgang Wessels, Walter Hallstein: der vergessene Europäer?, (Bonn: Europa Union Verlag, 1995). 238 CA, SOAM 42/1975 China, Record of a second meeting between Sir Christopher Soames and the Chinese Foreign Minister Mr. Chiao Kuan-Hua, Beijing, 6 May 1975.

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A difficult follow-up (May 1975 – January 1977)

‘We have to recognize that in the world of today the old balance-of-power idea, given a new civilized and sophisticated dimension, may be the best guarantee of peace in the immediate and near future. There is a recognition in this Soames initiative of the fact that we are a political as well as a trading community. There is recognition of this also in the Lomé Convention. We have here two examples in this current year of Europe's taking initiatives in the broader political or geo-political sense and emphasizing again that we have a positive contribution to make in this area where other peoples may not have the same sophistication and sense of history which this Community had and which enabled it to deal on this basis with a very historic people.’1

MEP Brian Lenihan, June 1975

‘We need to steer between the extremes of pretending to do more than we can do at the present stage of the Community's development and doing so little that the natural inertia of the Community's procedures, combined with Chinese lack of experience and hesitation, result in a total loss of momentum.’2

Sir Christopher Soames, May 1975

On 15 July 1975 the European Council welcomed emphatically the decision by the Chinese government to establish official relations with the Community.3

Two months later Li Lianpi took office as the first ambassador of the PRC accredited to the Community. The Commission began parallel discussions for an EEC-PRC trade agreement. Five preparatory meetings took place in

Brussels until February 1976. But the talks came to a stand-still which

1 Debates of the European Parliament, Report of Proceedings from 16 to 20 June 1975, Official Journal C 192, 1975 2 ECHA, BAC 136/1987/624, Follow-up on China, Soames to Wellenstein, Brussels, 13 May 1975. 3 The European Council, Brussels, 16-17 July 1975.

121 endured until January 1977, by which time Soames had left the Commission.

The reason for the stagnation of the relationship was that the Chinese government embroiled itself in domestic politics.

The Community progressed in liaising with the Chinese mostly because

Soames pushed for a speedy and comprehensive follow-up of his visit. The

European Parliament continued its pressure on the Commission and the

Council in order to enhance the freshly woven connection. Whilst the member states concerted at the EPC, they hardly did so at COREPER or the

Council of Ministers. And the Nine carried on their hands-off approach in shaping a distinctive Community approach towards China. The literature portrays the period after the establishment of official relations until January

1977 as a time of stagnation. 4 This research agrees that the EC-PRC relationship as such came to a stand-still. But it demonstrates that the opening to China brought about new movement in the Community’s relationship with the Soviet bloc. The EC work on China in this period continued to contribute to détente because it provoked more contacts with

Moscow, the Eastern European states and COMECON.

This chapter analyses the efforts of the European Community between

May 1975 and January 1977 to use the new momentum in its connection to the PRC government. First, the chapter examines the period up to the completion of diplomatic relations from Soames’ visit to Beijing until on 15

September 1975. Of particular interest is the European Parliament’s reception of Soames’ initiative and the reasons for having China on the agenda of the

4 See for example: Olivi, L'Europe difficile; Taylor, The Limits of European Integration; Coombes '‘Concertation’ in the Nation-State and European Community'.

122 second European Council meeting in Brussels in July 1975. Second, the chapter investigates the preparatory work for a trade agreement, and third how this came to a stand-still. Fourth, it looks at the various ways in which the Community sought to give political impetus to the EC-PRC relationship.

The focus is on the Commission’s work, the Tindemans Report and the

Community’s response to a natural disaster in China, followed by Zhou

Enlai’s and Mao Zedong’s death. Finally, the chapter considers the effect of the EC rapprochement with the PRC upon the Community’s relationship with the Soviet bloc.

The EP’s critical acclaim and the European Council’s support

In stark contrast to the member states’ passive reaction to Soames’ initiative,

MEPs from across the political spectrum reacted very enthusiastically and underlined the significance of the new developments. Soames then pushed for a speedy follow-up to his visit. This included putting the China dossier onto the European Council’s agenda. The Heads of State and Government did not discuss the issue further at their Brussels meeting in July 1975.5 Instead they gave the matter high visibility in the Council’s conclusions. Li Lianpi’s accreditation as ambassador to the Community sealed the establishment of official relations with the PRC.

Whereas individually, the French and British government reacted positively to the Commission’s work, their support hardly translated to

5 CARAN, 5 AG 3, 909, Compte-rendu du Conseil Européen de Bruxelles, 16/17 juillet 1975, Verbatim établi à partir des notes de M. Sauvagnargues.

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COREPER level.6 Charles Malo, Manac’h’s successor as French ambassador to China, praised Soames’ direct, efficient and straight-forward language that had speeded up conclusions. 7 The Quai d’Orsay’s Direction des ffaires

Economiques et Financières welcomed the outcome of Soames’ visit too.8

French officials interpreted the Chinese motivations as essentially political.

They viewed it as being partly linked to Deng Xiaoping’s visit to France that

May, and partly to the ambition to be the first Communist country to accredit an ambassador to the Community. 9 The British ambassador in Beijing,

Edward Youde, also took into account the context of the impending British referendum for EEC membership. He thought that the Chinese wanted to demonstrate their support for the unity of Western Europe as a counterweight to the Soviet Union. 10 What this meant for British policy,

Youde concluded pragmatically, was: ‘since the effect of their policy is helpful to us rather than otherwise there is no reason for us in this case to look a gift horse in the mouth.’11 Yet none of these or other deliberations led to an exchange of views at COREPER. t its restricted session on 12 May Soames’ visit met only with acknowledgement. 12 Michael Palliser, the British permanent representative to the Community, reported ‘There was no

6 ECHA, BAC 259.80, PVS 340, 21 May 1975. 7 AMAE, Série DE-CE, 1967-1975, 1967-1975, 107, Visite de M. Christopher Soames, Malo to Adresse Diplomatie Paris, Beijing, 9 May 1975. 8 AMAE, Série DE-CE, 1967-1975, 107, Récentes décisions chinoises à l'égard de la Communauté économique européenne, 9 May 1975. 9 Ibid. 10 NA, FCO 21/1390, Visit of Sir C Soames, Youde to Bentley, 12 May 1975. 11 Ibid. 12 CMA, Intermediate Archive, 40281/1975, Extrait du projet de compte-rendu sommaire de la 769ème réunion du Comité des représentants permanents, Brussels, 7-12 May 1975.

124 discussion.’13 A desire amongst the member states to muscle into the China dossier was not apparent at Community level.

The European Parliament by contrast responded very actively and encouragingly. On 14 May Jean-Joseph Schwed, the official at the

Commission’s General Secretariat responsible for liaising with the European

Parliament, warned Soames of the amount and fervour of MEP’s questions.14

The MEPs vehemently discussed at the sitting on 18 June, and asked Soames to explain the state of the EC-China relationship.15 The session offers not only evidence of the European Parliament holding the Commissioner accountable for his initiative, but also of the Parliament’s own stance. The accent throughout lay on the political. The opening quote of this chapter by Lord

Gladwyn, vice-president of the European Parliament’s Political Committee, captures the significance the EP gave to Soames’ visit. 16 The EC-PRC connection showcased that the Community was a reality the Soviet Union had to recognize, and the move had the potential to stabilise relations between the industrialised and industrialising countries. 17 According to the European

Parliament the new developments proved that the Community had a role as a

Third Force, although the MEPs did not explicitly used this term.

The MEPs from Britain praised Soames most highly. The British

Conservative Peter Kirk regarded it as ‘the most far-reaching event to take

13 N , FCO 21/1390, Sir Christopher Soames’ visit to China, Palliser, 12 May 1975. 14 ECHA, BAC 136/1987/624, Problèmes des relations de la Communauté avec la Chine à la session du Parlement du mois de juin, Schwed to Hannay, Strasbourg, 14 May 1975. 15 Debates of the European Parliament, Report of Proceedings from 16 to 20 June 1975, Official Journal C 192, 1975. 16 Ibid. 17 Ibid.

125 place in the field of the Community’s external relations’. Lord Hugh Dykes, a

Liberal, termed it even as a ‘first new, small step for mankind.’ nd Lord

Gladwyn congratulated Soames ‘on the able way in which he dealt with potentially explosive questions such as the recognition, or otherwise, of

Taiwan.’ 18 The support suggests a certain loyalty amongst the British in

Brussels, but it also corresponds to the British generally pushing most actively for a pronounced role of the Community in world politics. But the praise for Soames came also from quarters less known to be in favour of the

British. Brian Lenihan, an Irish MEP from the European Progressive

Democrats, quoted in the opening, described Soames’ mission as ‘a milestone in the development of relations between the Community and the rest of the world’. His acclaim is remarkable considering that he was from the Fianna

Fáil Party, at this point in time strongly anti-British.

In front of the European Parliament, Soames agreed that the establishment of an official Community-China relationship was ‘a notable diplomatic and political event’, but expressed caution about the future economic benefits. Consistent with his attitude prior to his visit to Beijing,

Soames stressed that trade prospects had to be seen in the long-term. As in his report to the Commission and COREPER, he emphasised that his visit was important in the context of the North-South dialogue.19

After May 1975 Soames remained in charge of pushing forward the

Community’s links with the Chinese. Soames’ approach is illustrated in a note to Wellenstein on 13 May cited in the opening quote of this chapter. The vice-

18 Ibid. 19 ECHA, BAC 259.80, PVS 340, 21 May 1975.

126 president personally ensured that DG I implemented his instructions as his written comments in the margins of official documents illustrate.20 And his chef de cabinet kept a close watch too. For example, Hannay remarked critically on a draft note on EC-PRC relations written by the Directorate

General of Information: ‘This is really not very good and needs extensive re- drafting’.21 He also pointed out that the European Parliament debate of 18

June needed mentioning, which shows the importance the Commission attached to the Parliament’s involvement. Thus Soames’ cabinet held a tight grip on the activities of the other Commission Directorates too.

The follow-up consisted also in Soames’ cabinet sending the records of the meetings between the Commission and the Chinese officials in Beijing in very strict confidence to the British Permanent Representative. Peter Edward

Hall, First Secretary of Britain’s Permanent Representation to the European

Community, noted that ‘their possession should not be revealed, and on no account should they be shown to our Community partners’.22 Undoubtedly a loyalty to the Commissioners’ country of origin remained whatever the degree of socialisation in Brussels, which meant the respective member states often had privileged access to information.23

To increase the political significance of the new relationship Soames worked through the European Council. At the EPC meeting on 26 May, he

20 ECHA, BAC 136/1987/838, Accreditation of Chinese ambassador, Fielding to Hannay, Brussels, 4 June 1975. 21 ECHA, BAC 136/1987/838, Projet de note d'information visant la Chine, Collowald to Klein, Brussels, 3 July 1975. 22 N , FCO 21/1391, EEC/China: Sir C Soames’ visit, Hall to Neville-Jones, 3 July 1975. 23 On the process of identifying with the Community in spite of their basic national loyalty: Coombes David, Politics and Bureaucracy in the European Community - A portrait of the Commission of the EEC, (Sage Publications: Beverly Hills, 1970), p.89.

127 suggested to the foreign ministers that the European Council should welcome the Chinese engagement at its next meeting in July.24 Soames’ rationale was that this would demonstrate in public that the Community endorsed the relationship. It would also offer a counterweight to the statements on détente linked to the CSCE which contained important concessions to the Soviet

Union. In line with the previous laissez-faire attitude none of the ministers spoke, which translated into an agreement with Soames.25 This pattern was replicated at the COREPER lunch on 3 July. 26 Taking advantage of this acquiescence, Soames went further. By 9 July he had proposed a precise formula for the Heads of States and Government to use in expressing their approval. He advised using the official press briefing on 17 July to say: ‘the

European Council warmly welcomed the decision by the Chinese People’s

Republic [...] and considered that this decision opened the way to the development of closer relations between China and Europe to which they attached great importance.’27

Considering that the Commission’s suggestion caused controversy amongst the member states, the absence of debate at COREPER and the

Council of Foreign Ministers is striking.28 The Foreign Office briefed on 10

24 ECHA, BAC 136/1987/624, Follow-up on China, Soames to Wellenstein, Brussels, 13 May 1975. 25 CMA, Intermediate Archive, 40281/1975, Traduction projet de texte, 7 July 1975; AMAE, Série DE-CE, 1967- 1975, 1070, Conseil du 26 mai - relations entre la Communauté et la Chine, Cazimajou to Adresse Diplomatie Paris, Brussels, 27 May 1975; NA, FCO 21/1390, EEC Council of Ministers, Dublin, 26 May: EEC/China, Galsworthy, 26 May 1975. 26 ECHA, BAC 136/1987/838, Chine, Meyer to Hannay, Brussels, 4 July 1975; NA, FCO 21/1391, EEC/China, Palliser to FCO, Brussels, 4 July 1975. 27 NA, FCO 21/1391, Council 15/16 July: préparations for the European Council, Palliser to FCO, Brussels, 8 July 1975. 28 AMAE, Série Direction des Affaires Politiques, Sous-Direction Asie-Océanie (henceforward AO), côte provisoire (henceforward prov.) 2158, Relations avec la République populaire de Chine, Cazimajou à Adresse Diplomatie Paris, Brussels, 11 July 1975.

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July that ‘On balance we are against this proposal.’29 First, it ‘could create an undesirable precedent. The Community has opened relations with many other countries with much less fuss.’ Second, the European Council already planned a statement on détente related to the CSCE and one on the United

Nations, and ‘Too many declarations devalue the currency.’ Third, ‘the disadvantages of possibly provoking them [the Russians] further with a statement concerning relations with China will not be balanced by the advantages to be gained.’ Thus a solution had to be found to ‘give the Soviet

Union less ground for annoyance’.30 Such remarks reflect the risks to détente that the Foreign Office continued to see in any improvement in the EC-PRC relationship. But in a turn-around one day prior to the European Council meeting James Callaghan, the Foreign Secretary, instructed his diplomats to support the Commission’s proposal.31

Therefore the British delegation accepted Soames’ suggestion without raising any concerns to its counterparts, who did not report any misgivings either. Albeit an internal note to the German Chancellor on 14 July cautioned about a statement on the establishment of diplomatic relations: ‘Es liegt nicht in unserem Interesse, wenn die hierzu in Aussicht genommene mündliche

Erklärung des präsidenten des ER vor der Presse zu emphatische ausfällt.‘32

This suggests that within the German Foreign Ministry, similar debates as to the ones in the FCO had taken place. But the foreign ministers agreed on 15

29 NA, FCO 30/2589, EEC/China: statement by European Heads of Government, 10 July 1975. 30 Ibid. 31 NA, FCO 21/1391, EEC-China: Fenn's letter to March 6/8 of 2 July, Callaghan, 14 July 1975. 32 Original emphasis. Archiv der sozialen Demokratie (henceforward AdsD), Helmut-Schmidt-Archiv (henceforward HSA), 1/HSAA006654, Tagung des Europäischen Rats am 16./17. Juli 1975 in Brüssel, Loeck to Chef BK and Bundeskanzler, Bonn, 14 July 1975.

129

July without discussion that the Heads of State and Government were to adopt a statement along the lines Soames had proposed.33 This proved to be the first and only time in the 1970s that the European Council concerned itself with the EC-PRC relationship.34 The Commission’s push through the

EPC proved effective.35

Tangible results of the Commission’s work came with the accreditation of Li Lianpi. Though the original Chinese request had been an accreditation to the ‘Communities’ rather than only the EEC, the Commission did not see a problem in the last minute changes by the Chinese side. Hannay remarked:

‘We always expected the Chinese would gag on Euratom and the request to open relations solely with the EEC. It is of no practical significance at all.’36

The press accorded attention to the event too. The Times correspondent

David Bonavia reported from Beijing on the setting up of official relations, as did all the major daily newspapers including the Financial Times, the New

York Herald Tribune, Le Monde, Frankfurter Allgemeine, and Die Welt.37

The setting up of diplomatic EEC-PRC relations also featured as the opening of the script for the audio-visual documentary ‘Le Monde Change, oici l'Europe’ which Emmanuele Gazzo, Director of gence Europe, meant to

33 NA, FCO 21/1391, Meeting of the Council of ministers 15 July: preliminary session: EEC/China, my telegram No. 3395, UK Rep Brussels to Butler, Braithwaite, Bentley, Brussels, 15 July 1975. 34 AN, Papers of al ry Giscard d’Estaing (henceafter 5 G 3), 909, Compte-rendu du Conseil Européen de Bruxelles 16/17 Juillet 1975 établit par le Conseil européen, verbatim établit à partir des notes de M. Sauvagnargues, undated. 35 See also on the relation between the Commission and the European Council: Mourlon-Druol, 'Filling the EEC Leadership Vacuum?. 36 ECHA, BAC 136/1987/838, hand-written side note, Hannay to Besford, Brussels, 8 September 1975. 37 David Bonavia, 'Soames talks lead to China-EEC link', The Times, May 9 1975; Reginald Dale, 'Peking to recognise EEC – trade agreement likely', Financial Times, 9 May 1975; Reuters Beijing, 'Visit by Sir Christopher Soames, China Plans EEC Envoy, Weighs Trade Pact', New York Herald Tribune, 9 May 1975;; 'Soames: Bald chinesischer Botschafter in Brüssel’, Frankfurter Allgemeine, 16 May 1975 Gerd Ruge, ‘Peking ist bereit zu Handelsvertrag mit der EG’, Die Welt, 9 May 1975; ‘La Chine “pro-europ enne”’, Le Monde, 10 May 1975.

130 write.38 Furthermore, the BBC contacted Hannay to receive more information on the accreditation for its planned weekly programme starting on 15

September.39

The PRC became the 103rd country and the first Communist country besides Yugoslavia to establish official relations with the EEC.40 The period shows that Soames remained firmly in charge of the China dossier for the EC.

The member states carried on with their ‘wait-and-see’ attitude on a

Community level. The episode also crystallised how the Commission, the

European Council and the European Parliament shaped the EC opening to

China working under different conditions. The Commission used China to reassert a role which had arguably already been conferred upon it by the Rome

Treaties. The European Parliament sought to create a new role for itself which these Treaties had not elaborated upon at all. And for the European

Council, China became a topic that contributed in legitimising its new role in the integration process, a role for which it did not yet have a formal legal basis.

The Commission pushes ahead with trade talks

Next to the accreditation, the most important follow-up item for Soames was the trade agreement. The steps for the Community to conclude a trade agreement were as follows: first, the Commission had to conduct preparatory talks with the country in question during which the parties discussed

38 Historical Archives of the European Union, Florence (henceforward HAEU), Papers of Emmanuele Gazzo (henceforward EG) 183, Information et Communication par l'audio-visuel (ICA), Cassigneu to Gazzo, Paris, 30 July 1975; HAEU, EG 183, Gazzo, 15 August 1975; HAEU, EG 183, Gazzo, 23 August 1975. 39 ECHA, BAC 136/1987/838, Clarke to Hannay, 29 August 1975. 40 Dick Wilson, 'China comes to Brussels', European Community, 1975, 9–12.

131 preliminaries such as scope and content of the agreement. The next step was for the Commission to lead exploratory talks. If these were successful, the

Commission would recommend negotiating directives to the Council. Once the Council approved these negotiating directives, the Council would mandate the Commission to begin official negotiations. At the end of this official negotiating phase, the Commission and the respective country would initial the trade agreement. If the Council approved the initialled trade agreement, a representative of the Council and the Commission would sign it.

The last step before the agreement could enter into force was its ratification by the European Parliament.

To advance the trade discussions Soames instructed Roland de

Kergorlay, one of the three deputy director general of DG I, to work closely with Manfred Caspari, another deputy director general of DG I, who held special responsibility for coordination and who oversaw relations with Asia.

Two meetings took place during which the Commission clarified the technical workings of the EEC to the Chinese delegation headed by Yen Judaic, counsellor at the Chinese embassy. They explained the EEC’s Generalised

Preference Scheme (GSP), the definition of quantitative restrictions and liberalisation, and the possible competences of a joint committee that would administer the trade agreement. The Commission also provided documentation regarding the EEC market for agricultural products such as cereals and pig meat. Furthermore, it restated that the agreement would be based on the Outline Agreement. 41 As a result of these meetings Hannay thought that ‘[a] lot of ground has now been covered’, which indicates the

41 ECHA, BAC 136/1987/624, Second meeting with representatives of the Chinese embassy, Brussels, 23 July 1975.

132 positive attitude by the Chinese towards progress in the months following

Soames’ China visit.42

Three further meetings took place in Brussels February 1976. Both sides agreed to have a general framework agreement rather than one concerned with detailed measures on specific products.43 Once the agreement had been signed, a joint committee was to deal with concrete issues such as the Chinese wish to see the Community’s quantitative restrictions on Chinese exports to the EC removed. The Chinese came to accept that the Community’s preferential treatment for Chinese products via the GSP remained an area for autonomous decision-making by the Community. Both sides also agreed on the inclusion of a most-favoured-nation (MFN) clause, a principle which in international law meant that countries could not discriminate between their trading partners.44 Both sides wanted to reach a rapid conclusion.

The trade discussions show the impact of the Cold War on the

Commission’s work in so far as they reveal the wider concerns regarding the contacts with the other Communist countries. Remarkably, the Commission took the lead in implementing in relation to China what the Nine had put down in the Second Basket of the Helsinki Final Act concerning economic relations between East and Western Europe. Ideological differences were not

42 ECHA, BAC 136/1987/624, Second meeting with representatives of the Chinese embassy, Brussels, 23 July 1975. 43 ECHA, BAC 136/1987/624, Fourth meeting with representatives of the Chinese mission, Brussels, 21 February 1976; ECHA, BAC 136/1987/624, Fifth meeting with representatives of the Chinese mission, Maslen, Brussels, 23 February 1975. 44 ECHA, BAC 136/1987/624, Fourth meeting with representatives of the Chinese mission, Brussels, 21 February 1976.

133 to hinder the evolution of economic relations. 45 Moreover, based on contextual evidence, the Commission effectively enacted in relation to the

PRC the aims of the Third Basket which dealt with ways of cooperation aimed at increasing cultural and educational exchanges, broadening the dissemination of information, facilitating human contacts, and solving humanitarian problems. At the CSCE, EPC was exclusively responsible for this policy area.46 But regarding China, the Commission upheld its role in this area too: it pushed successfully for a clause on more human contacts, and it insisted on including concrete measures such as training exchanges, visits, trade fairs, exhibitions. 47 Therefore, whether intentionally or not, the

Commission put into practice some of the Community’s aims for détente in

Europe in respect to détente in international relations as a whole.

An EEC-PRC trade agreement also exposed the economic competition the Community perceived vis-à-vis the United States. The question of the

Community securing a competitive advantage in the Chinese market against the Americans flared up particularly in the discussions over the Chinese meaning of ‘favourable considerations’ towards Community exports to

China.48 Despite Nixon’s visit to China in 1972, the merican and the PRC government did not normalise diplomatic relations until 1979. Until then a

US-China trade agreement proved unfeasible. Yet, as the reports from Beijing by the member states’ commercial counsellors from Beijing showed,

45 Gainar, Aux origines de la diplomatie européenne, chapter 5; Romano, From Détente in Europe to European Détente, p.45. 46 Gainar, Aux origines de la diplomatie européenne, chapter 5; Romano, From Détente in Europe to European Détente, p.159. 47 ECHA, BAC/136/1987/624, Fourth meeting with representatives of the Chinese mission, Brussels, 21 February 1976. 48 Ibid.

134

American businesses managed to secure advantageous deals with the Chinese even in the absence of a trade agreement.49 When the Chinese Mission offered to include a statement on ‘favourable consideration’, Louis Kawan wished to know what exactly this meant. He asked what would happen in the event of the PRC concluding a trade agreement with the United States too. The

Chinese reassured Kawan that they would reserve such treatment exclusively for the Community.50

deadlock arose on two principles, ‘balanced trade’ and ‘safeguard measures’, which epitomised the technical obstacles in concluding the trade agreement. The Chinese delegation insisted on ‘balanced trade’, which they understood as the aim to reach an equilibrium between imports and exports from and to the Community. The reason for this request was that they sought to close their trade deficit with the Community. But the Commission did not accept this principle. The Community was a market economy and therefore could not force firms to carry out certain imports or exports. And the

Commission was concerned about its position at the GATT. If it adopted such a clause, it would have to grant it to all GATT members.51 At the same time, the Commission insisted on a safeguard clause which it could invoke

49 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (2ème Rapport), 26 March 1974; CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (4ème Rapport), 3 May 1975. 50 ECHA, BAC 136/1987/624, Fourth meeting with representatives of the Chinese mission, Brussels, 21 February 1976. 51 CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (3ème Rapport), 24 October 1974; ECHA, BAC 136/1987/629, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (4ème Rapport), 3 May 1975.

135 unilaterally without prior consultation with the Chinese party. This clause proved important to prevent Chinese exports to the EC coming in below international market prices. But the Chinese side rejected this clause. Yen’s comment after the fifth meeting that ‘even if not much progress had been made the two sides know each other better’, was a diplomatic way to describe the technical impasse.52

Remarkably as the Commission laid the basis for the scope and content of the trade agreement, the Nine did not involve themselves in framing or steering its work. They certainly kept a watch though and realised the political nature of the trade talks. The Italian government put relations with

China on the agenda of their Council Presidency from July to December

1975.53 At the FCO, Christopher William Roberts from the Department of

Trade, asked the British Permanent Representation in Brussels about the possible timing of discussions à Neuf on EEC-China relations. 54 And the

Service de cooperation conomique at the Quai d’Orsay recognised the essentially political nature of the Chinese decision to engage in trade talks.55

But despite this awareness, the Nine did not think it necessary to intervene.

The French simply wished that the Council could as soon as possible examine a formal proposal by the Commission and give it the mandate to open official negotiations.56

52 ECHA, BAC 136/1987/624, Fifth meeting with representatives of the Chinese mission, 18 February 1976, Maslen, Brussels, 23 February 1975. 53 AMAE, Série DE-CE, 1967-1975, 1113, Programme de travail de la présidence italienne, July 1975. 54 NA, FCO 21/1391, EEC - China meetings, Hall to Roberts, Brussels, 23 July 1975. 55 AMAE, AO, prov. 2158, Chine - CEE, Service de coopération économique, Paris, 10 November 1975. 56 Ibid.

136

The member state’s permissive attitude is noteworthy in a period when they heavily contested the Commission’s authority on the Common

Commercial Policy. During this very period, the member states engaged in trade negotiations with Japan and Eastern European countries which infringed upon the Commission’s territory. For instance, the UK bilaterally negotiated export restraint measures for footwear and textiles from Eastern

Europe, and the Benelux pressed Japan to continue export restraint on electronic items. 57 Such actions were exclusive to the Community’s competences and therefore for the Commission to handle. Consequently the

Commission repeatedly complained that it could not ‘ignore such flagrant breaches of the Treaty without losing its credibility both with member states and with third countries.’ 58 Hence the institutional dynamic regarding an

EEC-PRC trade agreement was another example of how the case of China bucked the usual trend.

The limited importance the member states accorded to the

Commission’s work on China was also striking considering that in 1975 EC-

PRC commercial exchanges increased. And the establishment of official relations was very likely to have contributed to this trend. In 1975 the global trade between the EC and China increased by 14 %, from US$ 1889 million in

197 to US$ 2150 million in 1975. This meant that China’s external trade with the EC increased by 2 %, representing 17 % of China’s total external trade. In contrast, China’s trade with the United States decreased by 4 % and

57 ECHA, BAC/3/1978/1517, Illegal negotiations by Member States, Hijzen to Soames, Brussels, 7 July 1976. 58 Ibid.

137 represented 7 % of China’s total external trade.59 The Community’s exports to

China increased by 35 %, from US$ 1018 million to US$ 1378 million, and the

Community’s imports from China decreased by 12 %, from US$ 871 million to

US$ 771 million. Therefore the deficit of China in relation to the EC increased from US$ 147 million in 1974 to US$ 610 million in 1975. 60 The most important change concerned the balance of trade with France which had a deficit of US$ 25 million with China in 1974, and in 1975 recorded a surplus of US$ 198 million. As in 1974, Germany obtained the largest surplus, and together with France it accounted for 83 % of the total surplus the EC had in relation to the PRC in 1975. 61 Hence compared to 1974, the EEC exports to

China in 1975 showed the following distribution:

59 ECHA, BAC 28/1980/883, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (1) (7ème rapport), Brussels, 8 September 1976. 60 Ibid. 61 Ibid.

138

Table 0-1: Distribution of EC exports to China in 1974 and 1975

1974 1975

FRG 45 % 38 %

France 17 % 26 %

UK 17 % 12 %

Italy 10 % 10 %

Netherlands 6 % 9 %

UEBL 3 % 3 %

Denmark 1 % 1 %

Ireland - -

The EC imports from China were distributed as below:

Table 0-2: Distribution of EC imports from China in 1974 and 1975

1975 1974

Germany 29 % 24 %

France 22 % 23 %

Britain 16 % 14 %

Italy 15 % 18 %

Netherlands 10 % 12 %

UEBL 5 % 5 %

Denmark 3 % 4 %

Ireland - -

The variation in the trade in 1975 compared to 1974 between the EC and

China for Germany, France and Britain individually looked as follows:

139

Table 0-3: Variation in trade in 1975 compared to 1974 between the EC and China for Germany, France and Britain

EEC imports EEC exports from the to the PRC PRC

Germany +15 % +8 %

France +110 % -15 %

Britain -5 % -24 %

In their previous reports, learning from the American, Spanish and Greek experience, they had considered such a political development beneficial for trade.62 It is all the more notable that the commercial counsellors did not analyse the effect of the diplomatic relations. In their previous reports they had written that such a political development would be beneficial for trade.

At least this is what the American, Spanish and Greek experience had shown.63

The Nine’s continuing passive attitude might be explained by the fact that the Commission had not yet gone very far in the trade discussions, and in the last instance the Council of Ministers was the body which would have to sign off any EEC-PRC trade agreement. Moreover, the trade continued to be limited. The trade figures gathered by the International Monetary Fund

(IMF) in 2006 below differ from the ones the commercial counsellors used. A possible explanation is that the IMF had more accurate data available in

2006. But irrespective of the difference, the figures support the general point

62 See for example: CMA, Historical Archive, CM2, CEE CEA 2026/1974, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (3ème rapport), 24 October 1974. 63 Ibid.

140 about the relatively small proportion that the trade with China represented for the Community in 1974 and 1975.

Table 0-4: Direction of trade of the Nine for 1974 and 1975 in million US $64

Exports of the Nine to 1974 1975

the PRC 965 1421

Hungary 1275 1197

Sweden 8378 8972

the United States 19056 16902

Imports by the Nine from 1974 1975

the PRC 821 812

Hungary 840 863

Sweden 8060 8219

United States 23723 24788

The establishment of official EC-PRC relations and the Commission’s trade talks also did not inhibit each of the Nine from pursuing their own commercial activities in the PRC. 65 The member states continued to sign bilateral agreements, establish mixed committees and organise exhibitions and trade fairs.66

64 International Monetary Fund (2006): Direction of Trade Statistics (Edition: 1948-1980). ESDS International, University of Manchester. 65 Compare: McAllister, European Union, p.102. 66 See aviation agreement: FRG, Beijing, 31 October 1975; navigation agreement: Netherlands, Beijing, 4 July 1975; France, Beijing, 28 Septembre 1975; FRG, Beijing, 31 October 1975; agreement on textile brands: France, Beijing, 15 July 1975; FRG, Beijing, 28 August 1975; Joint Committees: Italy, Rome, 25 October 1975 (meeting); Denmark, 26 October 1975 (meeting); FRG, Beijing, 31 October 1975 (agreement setting up the joint committee); exhibitions: UK, Italy, Belgium and the FRG in 1975; ECHA, BAC 28/1980/883, Rapport des conseillers commerciaux des pays de la

141

The Nine asserted their national economic interest vis-à-vis the

Commission in different ways, as individual requests, separate from preparatory talks for an EEC-PRC Trade Agreement. For example, they called on the Commission to exclude Chinese products such as umbrellas and ceramics from Community treatment.67 They also asked the Commission to discuss their concerns with the Chinese regarding the dumping of Chinese products on the European market.68 The seemingly minor issue of imports of

Chinese mushrooms into the EC, over which France and West Germany in particular had differences, required the Commission to discuss the matter numerous times.69 Furthermore, so long as no EEC-PRC Trade Agreement existed, the Nine sought autonomous quotas for imports. 70 A revealing instance was when in 1976 the German government pushed for an earlier publication of the autonomous quotas for 1977. Germany wanted the list to be

Communauté économiques européenne en République populaire de Chine (1) (7ème rapport), Brussels, 8 September 197. 67 See for example: Council decisions 75/454/EEC, 75/496/EEC, 75/718/EEC, 76/39/EEC, 76/529/EEC. 68 ECHA BAC 136/1987/626, Compte-rendu d'une entrevue avec des fonctionnaires de la Mission chinoise le 08.10.1976, Exportation de chemises chinoises vers le Royaume-Uni, Kasselhoff, Brussels, 8 October 1976. 69 ECHA, BAC 136/1987/624, Fifth meeting with representatives of the Chinese mission, 18 February 1976, Maslen, Brussels, 23 February 1975; ECHA, BAC 136/1987/625, Imports of Chinese canned mushrooms, Maslen, Brussels, 30 September 1975; ECHA, BAC 136/1987/625, Imports of Chinese canned mushrooms, Maslen, Brussels, 17 December 1975; ECHA BAC 136/1987/625, China: canned mushrooms, Avery to Klein, 21 January 1976; ECHA BAC 136/1987/625, Imports of Chinese canned mushrooms, Maslen, Brussels, 10 February 1976; ECHA BAC 136/1987/625, Observations des services de la DGI à votre note du 28.2.76 sur la situation du marché des conserves de champignons, Simonet, Maslen, Krenzler to Windle, Brussels, 14 May 1976. 70 European Commission, Ninth General Report on the Activities of the European Communities in 1975, (Brussels: EEC, 1976), p.272; European Commission, Tenth General Report on the Activities of the European Communities in 1976, (Brussels: EEC, 1977), p.250; European Commission, Twelfth General Report on the Activities of the European Communities in 1978, (Brussels: EEC, 1979), p.234; CMA, Historical Archive, CM2, CEE CEA 100/1976, 827ème réunion du Comité des représentants permanents, Brussels, 30 September - 1 October 1976; ECHA, BAC 48/1984/689, Proposition de décision du Conseil portant reconduction provisoire anticipée pour l'année 1977 des contingents d'importation arrêtés pour l'année 1976 à l'égard de la République Populaire de Chine par la décision du Conseil 75/788/CEE, Wellenstein à Soames, 9 September 1976.

142 available before the Canton fair in mid-October 1976. 71 The timing was important because companies wanted to know the import possibilities for

1977 from China to Germany in order to conclude appropriate trade contracts. But Britain was concerned that such an early publication would constitute an unwanted precedent vis-à-vis the other state trading countries.72

The Commission mediated between the member states and facilitated a solution: a provisional list and a Council of Ministers statement that underlined the exceptional circumstances of an early publication.73 Thus the

Nine requested the Commission to take up an administrative, coordinating and mediating role in the Common Commercial Policy which the

Commission willingly played.

In the nine months following the establishment of diplomatic relations, five preparatory meetings for an EEC-PRC trade agreement took place between the Commission and the Chinese mission. The member states barely involved themselves in the discussions or steered the Commission. Instead the Nine worked with the Commission in its mediating role in the framework of the Common Commercial Policy. In 1975, the commercial exchanges between the EC and the PRC increased which was likely to be linked to the setting up of official relations. But a deadlock in the trade talks crystallised around two technical issues: a balance of trade clause, which the Chinese

71 AMAE, Série DE-CE, NC 1369, van der Stoel to Ministre des affaires étrangères, Brussels, 8 October 1976; referring to: Décisions du Conseil portant reconduction provisoire anticipée pour l'année 1977 des contingents d'importation arrêtés à l'égard de la Republique populaire de Chine par la décision 75/210/CEE pour l'année 1976. 72 AMAE, Série DE-CE, NC, 1369, Décision du Conseil portant reconduction provisoire anticipée pour l'année 1977 des contingents arrêtés pour 1976 a l'égard de la Chine - Résultats des travaux du Groupe des Questions Commerciales (réunion du 24 septembre 1976). 73 AMAE, Série DE-CE, NC, 1369, van der Stoel to Schumann, Brussels, 8 October 1976.

143 insisted upon, and the safeguard procedures, which the Commission did not want to compromise on.

Stagnation due to Chinese domestic turmoil

February 1976 marked the beginning of a period of stagnation in the talks for an EEC-PRC trade agreement. Even if the Commission and the Chinese had reached a solution over the technical deadlock, they would have waited in vain for a delegation from Beijing to begin exploratory talks. The reasons were that the domestic turmoil in the PRC, which stemmed from an intensifying three-cornered leadership struggle between Premier Hua

Guofeng, Vice-Premier Deng Xiaoping and the Gang of Four, paralysed

China’s foreign policy.74 The Gang of Four comprised the four radical leaders of the Cultural Revolution, Jiang Qing, Zhang Chunqiao, Yao Wenyuan, and

Wang Hongwen. Indeed, Endymion Wilkinson from the Commission’s delegation in Tokyo sent a note on 22 April 1976 predicting that ‘Until the new Premier [Hua Guofeng] has consolidated his political position Chinese initiatives will be limited’.75 He advised that the Commission should lower its expectations for progress, and Soames commented: ‘I fear, a correct analysis.

We shall see.’76

But the lack of Chinese cooperation did not mean that the Commission’s efforts came to a stand-still. When no response from Beijing arrived regarding the next stage in trade discussions, Soames seized the opportunity

74 Roderick MacFarquhar (ed.), The Cambridge History of China (Cambridge: Cambridge University Press, 1991), pp.360–317; Ebinger, 'The Politics of Potential', p.384 and p.395. 75 ECHA, BAC 136/1987/624, Vulpitta to Hannay, Tokyo, 22 April 1976. 76 ECHA, BAC 136/1987/624, Vulpitta to Hannay, Tokyo, 22 April 1976 and hand-written side-note by Soames, 9 May 1976.

144 of the presence of Yu Huimin, the Chinese counsellor, at a session of the

European Parliament in Strasbourg in March 1976 to discuss the trade talks.

Soames addressed in particular how to deal with the two outstanding difficulties: the balanced expansion of trade and the safeguard procedures.

Soames even offered to raise the matter to a political level, doing away with the technicalities.77 Since the only response Soames received was that Yu promised to transmit his offer to Beijing, and no response followed, Soames even addressed a letter directly to the Chinese Minister for Foreign Trade Li

Jiang on 1 April. In this letter Soames stressed that there was a basis for a trade agreement, which he believed had considerable political importance.78

He attached a draft for a trade agreement in which the Commission outlined the structure of the clauses and suggested formulae to solve the controversies. But Soames never received a reply. The one, albeit small step, which indicated that the Chinese remained tuned into the relationship was that the government announced an extension of its representation in Brussels by accrediting a commercial counsellor to the EEC.79

Soames also tried to push forward with a Community trade fair in

China. The ambassadors in Beijing had advised him during his visit in May

1975 that a trade fair focussing on European advanced technology would be a

‘particularly useful form of follow-up’.80 Soames’ motives in picking up the idea were mainly political, not least to seal the relationship with the PRC and

77 ECHA, BAC 136/1987/624, China, Hannay, 11 March 1976. 78 ECHA, BAC 48/1984/687, Soames to Li Chiang, 1 April 1976. 79 NA, FCO 98/136, Article, BØrsen Danish news agency's Peking correspondent, China wishes to extend her EEC contacts, Beijing, 19 March 1976. 80 ECHA, BAC 136/1987/624, Community exhibition/trade fair in China, Klein to Meynell, 22 January 1976.

145 use the new momentum created by his visit.81 When the EC-PRC relations came to an almost complete halt, the fair became even more of a political instrument as John Maslen, China desk officer at the Commission, stressed to the Council of Ministers Working Group on 12 May 1976. 82 But coordinating the project between the ambassadors and commercial attachés in Beijing, the national representatives of the Council of Ministers Working

Group in Brussels, the national Foreign Ministries and the Chinese proved so tedious that Soames did not see its realization during his time in office.83 In fact, no Community trade fair saw the light in the 1970s. It was a project that illustrates how coordination could be frustrated when a multitude of different bureaucracies were involved, when national commercial advantages proved minimal, and when the political will was not forceful enough.

The European Parliament still persisted in pushing for progress and asserting its institutional role. Back in August 1975, Cornelius Berkhouwer, vice-president of the European Parliament, had visited China at the invitation of the Chinese Institute of Foreign Affairs. He had used the opportunity to speak to the press and meet with the ambassadors of the member states in

Beijing. 84 The MEPs had continued to put pressure via written questions directed towards the two more powerful Community institutions. Pierre-

Bernard Cousté, Member of the Group of European Progressive Democrats,

81 ECHA, BAC 136/1987/624, Follow-up on China, Soames to Wellenstein, Brussels, 13 May 1975. 82 ECHA, BAC 136/1987/838, Meeting of 'Fairs and Exhibitions' Working Group, Dicussion of Community exhibition in China, Maslen to Kawan, Brussels, 17 May 1976. 83 Ibid; AMAE, AO, prov. 2130, Projet d'exposition des Communautés européennes en Chine, Arnaud, Beijing, 9 November 1976. 84 AMAE, AO, prov. 2158, Visite en Chine du Vice-Président Berkhouwer, Arnaud to Adresse Diplomatie Paris, Beijing, 21 August 1975; ECHA, BAC 136/1987/624, Press conference in Beijing by Cornelius Berkhouwer, 12 August 1975.

146 for example asked in October 1975 whether the Commission had opened negotiations for a trade agreement, and how far they had progressed.85 Now, as the trade talks came to a halt Alain Terrenoire, French Christian

Democrat, asked during the 16 June 1976 session whether the Council intended to concern itself with the China dossier. He even put an unforeseen question, asking which rules governed relations with China once the current bilateral ones had expired on 1 January 1975.86 Gaston Thorn, the acting

Council President and Prime Minister of Luxembourg, replied that he was not prepared for such a question. MEPs thus again used the China issue to raise its profile

The suspension of the Commission’s trade talks with the Chinese did not prevent the member states’ trade with China from increasing. The Nine increased their share in the external trade of China by 2 %, up to a level which now represented 20 % of total Chinese external trade.87 As in 1975, the trade between China and the United States and Australasia diminished, now representing 5.8 % of China’s total trade. 88 The commercial counsellors estimated that one important reason for the deteriorating trade relations between the United States and China was the absence of diplomatic relations.89 Total trade between the Nine and China went from US$ 2150

85 Written Question No. 450/75, by Mr. Cousté to the Commission of the European Communities, Official Journal C 292, 1975. 86 Debates of the European Parliament, Report of Proceedings from 14 to 18 June 1976, Oral Question No. 3, by Mr. Terrenoire to the Council of Ministers, Official Journal C 204, 1976. 87 CMA, Intermediate Archive, 39129/1975, Rapport des conseillers commerciaux des pays de la Communauté économiques européenne en République populaire de Chine (1) (9ème Rapport), Brussels, 25 January, 1978. 88 Ibid. 89 Ibid.

147 million in 1975 to US$ 2199 million in 1976.90 The Community’s exports to

China diminished by 8 %, from US$ 1378 million in 1975 to US$ 1269 million in 1976, whereas the Community’s imports from China increased by 20.6 %, from US$ 771 million in 1975 to US$ 930 million in 1976.91 Thus the deficit of China vis-à-vis the EEC diminished from US$ 610 million in 1975 to US$

339 million in 1976.92 The most significant change concerned the balance of trade between Germany and the PRC. In 1975 all of the EC countries had a surplus trade. In 1976 only two remained, France and Germany. But only the latter increased its surplus by US$ 53 million, from US$ 298 million in 1975 to US$ 351 million in 1976.93 Hence in 1976 the distribution of the EC exports to China looked as follows:94

Table 0-5: Distribution of EC exports to China in 1975 and 1976

1975 1976

Germany 38 % 49 %

France 26 % 25 %

Britain 12 % 9 %

Italy 10 % 11 %

Netherlands 9 % 3 %

UEBL 3 % 3 %

Denmark 1 % 1 %

Ireland - -

90 Ibid. 91 Ibid. 92 Ibid. 93 Ibid. 94 Data according to the exchange rate of the US $ at the end of December 1975 and 1976; CMA, IA 39129/1975, Rapport des Conseillers Commerciaux des Pays de la Communauté Économiques Européenne en République Populaire de Chine (1) (9ème Rapport), Brussels, 25 January 1978.

148

The shares of EC imports from China were allocated as below:95

Table 0-6: Distribution of EC imports to China in 1975 and 1976

1975 1976

Germany 29 % 29 %

France 22 % 20 %

Britain 15 % 16 %

Italy 16 % 16 %

Netherlands 10 % 10 %

UEBL 5 % 6 %

Denmark 3 % 3 %

Ireland - -

In 1976, the variation in the trade in 1976 compared to 1975 for Germany,

France and Britain looked as follows (in brackets are the percentage calculated on the basis of statistics in national currencies, to prevent distortion caused by the variation in exchange rates):96

Table 0-7: Variation in trade in 1975 compared to 1976 between the EC and China for Germany, France and Britain

EEC exports to the EEC imports

PRC from the PRC

Germany +19 % (+22 %) +21 % (+23 %)

France -14 % (+0,5 %) +8 % (+25 %)

Britain -28 % (-15 %) +24 % (+46 %)

95 Ibid. 96 Ibid.

149

The IMF data acts as a reminder of how small a proportion of total

Community trade that with China continued to represent.

Table 0-8: Direction of trade of the Nine for 1975 and 1976 in million US $97

Exports of the Nine to 1975 1976

the PRC 1422 1314

Hungary 1197 1194

Sweden 8972 96123

the United States 16902 18246

Imports by the Nine 1975 1976 from

the PRC 812 949

Hungary 864 943

Sweden 8219 8730

United States 24788 27623

The positive trend seen in 1975 in trade relations between the Community and China continued in 1976. But the EC was not yet able to operate as an actor in its own right and fully implement its Common Commercial Policy vis-à-vis China. To this end the Commission was to be in charge of an EEC-

PRC trade agreement. The trade talks stalled because the Chinese first had to sort out their domestic political issues. This showed how much the dynamic between the Community and China depended on the Chinese willingness and ability to cooperate.

97 International Monetary Fund (2006): Direction of Trade Statistics (Edition: 1948-1980). ESDS International, University of Manchester.

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Attempts of more political presence: the Tindemans Report, emergency relief and messages of condolence

Once official relations had been established, the Commission and the

European Parliament sought to promote and enhance the diplomatic side of the relationship with the PRC too. But whereas these two institutions kept their eyes on the ball, the member states returned to their characteristic hands-off attitude after the European Council meeting in July 1975. Only the

Belgian Prime Minister Leo Tindemans confronted the Nine with the necessity to develop a common Community approach to the PRC.

The Commission used a variety of instruments to further the EC-PRC relationship. It prepared a visit by Ortoli to China, and invited a group from the Chinese Institute for Foreign relations to visit the EC institutions at the

Commission’s expense.98 Particularly with regard to the latter the political intention to reinforce the link with the Chinese government becomes apparent. Camille Becker, Commission official working at the Directorate for

Information, wrote to Hannay about possible dates for the visit. She noted that although ‘From a financial point of view DG X would prefer to postpone this visit until 1976. Political consideration should, however, prevail.’99 To ensure that the Chinese visitors also witnessed the Community workings in

Luxembourg and Strasbourg, the Commission proposed times when the

European Parliament was in session. The dates suggested reflect the

98 See for example: ECHA, BAC 136/1987/624, Follow-up on China, Soames to Wellenstein, Brussels, 13 May 1975; ECHA, BAC 136/1987/624, Third meeting with representatives of the Chinese mission, Maslen, Brussels, 10 December 1975; ECHA, BAC 136/1987/624, Relations avec la Chine, Klein, Brussels, 16 December 1975. 99 ECHA, BAC 136/1987/624, Information China, Becker to Hannay, 11 September 1975.

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Commission’s endeavour to associate the European Parliament closely with the building up of relations with China.

In light of the new political momentum in the relationship with China, it is noteworthy that still neither the Council of Ministers nor COREPER concerned themselves much in their weekly and monthly sessions with a

Community policy vis-à-vis China. Not even the British raised the issue, although Youde recommended to William Bentley, FCO Head of the Far

Eastern Department, via a teleletter of 11 November 1975, a common

Community approach to China.100 According to Youde, the advantage of using the EC rather than NATO was twofold. First, it did not include Portugal, whom ‘The Chinese believed to be in the pockets of the Russians’. nd it did not include the United States whom the Chinese assumed dictated NATO.

Thus the PRC government was likely to be less suspicious of a Community policy than a NATO one. Second, the French were unlikely to cooperate in a

NATO context, which made the EC the more promising machinery to use.

Such deliberations illustrate the British view that the European Community was more a means to an end rather than an end in itself, but also how the

Cold War furthered European integration.

It was Tindemans’ report for a European Union which brought the issue of a common European policy towards the PRC directly to European Council on 29 December 1975.101 This report was the result of an instruction by the

Heads of States and Government during the Paris Summit in December 1974

100 NA, FCO 21/1380, Consultations on China, Youde to Bentley, Beijing, 21 November 1975. 101 Leo Tindemans, 'European Union', European Commission, Bulletin of the European Communities, Supplement 1/76, 1976.

152 to investigate a definition for a ‘European Union’. The report aimed to provide a base for a revival of the European integration process which the economic and political crisis threatened. Tindemans’ task was to consult the

European institutions, who submitted reports to him on the subject, but also prominent people from politics, the economy, the trade unions, and intellectuals amongst the member states.102 In these consultation meetings,

Tindemans thought that external policy was a determining preoccupation amongst his interlocutors. Therefore his report tackled the external relations of the Community prior to its internal development and institutional structure.103 He found that it was ‘essential for the European Union to have an external policy.’104 Though the main areas for coordination which Tindemans picked out were the Middle East, the United States and the Mediterranean region, part of the Community’s external policy had to concern China too, not least because it showed ‘increasing sympathy for the task of European unification’.105

The initial official reaction of most member states to the report was reserved.106 The French were very sceptical of a closer cooperation in foreign affairs, and China was of no special concern.107 This links to the member

102 Leo Tindemans, De Memoires. Gedreven door een overtuiging, (Tielt: Lanoo, 2003), pp.307–318. 103 NA, FCO 30/3190, Discours de Leo Tindemans, Premier Ministre de Belgique, au déjeuner du cercle de l'opinion et du mouvement européen, Service de Presse, Paris, 16 February 1976. 104 European Commission, Bulletin of the European Communities, Supplement 1/76, 1976, p.14. 105 European Commission, Bulletin of the European Communities, Supplement 1/76, 1976, p.18. 106 AMAE, Série Direction des Affaires Politiques, Sous-Direction Europe (henceforward E- CE) 3775, Premières réactions de nos partenaires, 15 January 1976; NA, FCO 30/3190, Tindemans Report, Shepherd to Collings and Fretwell, undated; AMAE, E-CE, 3775, La Grande-Bretagne et le rapport Tindemans, Sous-Direction d'Europe occidentale, Paris, 9 March 1976. 107 AMAE, E-CE, 3775, Rapport Tindemans, Service de Coopération Economique, Paris, 25 February 1976; AMAE, E-CE, 3775, Rapport Tindemans, 23 March 1976; AMAE, E-CE, 3775, Visite à Paris de M. Van der Stoel, Ministre néerlandais des affaires étrangères, Paris, 17 June 1976.

153 states’ typical reluctance to integrate in the foreign policy field. Yet, the

British were more positive than the French about closer coordination in external relations, and consistent with their activity at EPC, they agreed that

China was one area for such cooperation. 108 Internal analysis and consultation meetings with other member states show that the British supported Tindemans’ recommendation on China. 109 Butler suggested to

Henri Froment-Meurice, director d’Asie-Océanie at the Quai d’Orsay, that

‘the Community might concert more on policy towards China in future’.110

Overall, however, the importance the Tindemans Report gave to China did not notably affect the workings of the European Council, the Council of

Ministers, or COREPER.

Despite the lack of engagement by the Chinese government from

February 1976 onwards, the Commission continued its diplomacy. When on

28 July 1976 an earthquake struck the area of Tientsin with devastating effects, Soames decided to offer emergency assistance in the name of the

Community to the PRC government. This was done in the face of opposition from the Nine.111 On 29 July the Dutch ambassador in Beijing had called

108 NA, FCO 30/3190, Cabinet papers: The Tindemans Report, undated; FCO 30/3194, Annex A, shortened version of brief for European Council, Luxembourg, 1/2 April 1976, Tindemans Report, undated; FCO 30/3194, Annex B, Note by officials, Tindemans Report on European Union: foreign policy aspects, March 1976; FCO 30/3190, EEC: meeting with MM Froment-Meurice and Bernard, Paris, 8 March, Butler to Arculus, Paris, 25 February 1976. 109 AMAE, E-CE, 3775, Réactions des neuf au rapport Tindemans, Sous-Direction d'Europe Occidentale, Paris, 4 March 1976; NA, FCO 30/3194, Annex B, Tindemans Report on European Union: Foreign Policy Aspects, March 1976; AMAE, E-CE, 3775, La Grande-Bretagne et le rapport Tindemans, Sous-Direction d'Europe occidentale, Paris, 9 March 1976; AMAE, E-CE, 3775, Opinion britannique sur le rapport Tindemans, Paris, 24 February 197. 110 NA, FCO 30/3190, EEC: meeting with MM Froment-Meurice and Bernard, Paris, 8 March, Butler to Arculus, Paris, 25 February 1976; AMAE, E-CE, 3775, Opinion britannique sur le rapport Tindemans, Paris, 24 February 1976; AMAE, E-CE, 3775, Réactions des neuf au rapport Tindemans, Sous-Direction d'Europe Occidentale, Paris, 4 March 1976. 111 AMAE, E-CE, 4196, Tremblement de terre, Soulier to Adresse Diplomatie Paris, Beijing, 29 July 1976; AMAE, E- CE, 4196, Réunion communautaire, Soulier to Adresse Diplomatie Paris, Beijing, 30 July 1976; AMAE, E-CE, 4196,

154 together his counterparts from the other member states to exchange views on the response their respective governments should give to the earthquake.

Subsequently the Nine had sent individual messages of sympathy and proposed humanitarian relief aid.112 On the question however, of whether the

Nine ought to offer a concerted aid package in the name of the Community, the member states had been unanimously against.113 But on 3 August, on

Soames’ initiative which Ortoli supported, Friedrich Klein, Director at DG I in charge of relations with the state trading countries, met with Xie Zhenliu, second secretary at the Chinese mission to the EEC, to offer emergency assistance in the name of the EC.114 What was more, Klein asked whether the

Chinese would mind were the press to report on their offer.115 This illustrates how the Commission also saw relations with the PRC as an opportunity to shore up its role in public. Since the Chinese representatives did not mind,

Catastrophe sismique en Chine, The Hague Coreu to all Coreu, The Hague, 30 July 1976; AMAE, E-CE, 4196, Seisme en Chine, Copenhagen Coreu to The Hague Coreu, info all Coreu, Copenhagen, 2 August 1976; AMAE, E-CE, 4196, Chinese earthquake, London Coreu to The Hague Coreu, info all Coreu, London, 2 August 1976; AMAE, E-CE, 4196, Catastrophe sismique en Chine, Bonn Coreu to The Hague Coreu, info all Coreu, Bonn, 2 August 1976; AMAE, E-CE, 4196, Catastrophe sismique en Chine, Brussels Coreu to The Hague Coreu, info all Coreu, Brussels, 2 August 1976; AMAE, E-CE, 4196, Catastrophe sismique en Chine, Rome Coreu to The Hague Coreu, info to all Coreu, Rome, 3 August 1976. 112 AMAE, E-CE, 4196, Tremblement de terre, Soulier to Adresse Diplomatie Paris, Beijing, 29 July 1976; AMAE, E- CE, 4196, Réunion communautaire, Soulier to Adresse Diplomatie Paris, Beijing, 30 July 1976. 113 AMAE, E-CE, 4196, Catastrophe sismique en Chine, The Hague Coreu to all Coreu, The Hague, 30 July 1976; AMAE, E-CE, 4196, Seisme en Chine, Copenhagen Coreu to The Hague Coreu, info all Coreu, Copenhagen, 2 August 1976; AMAE, E-CE, 4196, Chinese earthquake, London Coreu to The Hague Coreu, info all Coreu, London, 2 August 1976; AMAE, E-CE, 4196, Catastrophe sismique en Chine, Bonn Coreu to The Hague Coreu, info all Coreu, Bonn, 2 August 1976; AMAE, E-CE, 4196, Catastrophe sismique en Chine, Brussels Coreu to The Hague Coreu, info all Coreu, Brussels, 2 August 1976; AMAE, E-CE, 4196, Catastrophe sismique en Chine, Rome Coreu to The Hague Coreu, info to all Coreu, Rome, 3 August 1976. 114 ECHA, BAC 136/1987/838, Ortoli to Huan Hsiang, Brussels, 30 July 1975; ECHA, BAC 136/1987/838, Commission to Chiao Kuan Hua, Brussels, 3 August 1976; ECHA, BAC 136/1987/838, Proposition d'une 'emergency assistance' à la Chine, Dablanc, Brussels, 4 August 1976. 115 ECHA, BAC 136/1987/838, Ortoli to Huan Hsiang, Brussels, 30 July 1975; ECHA, BAC 136/1987/838, Commission to Chiao Kuan Hua, Brussels, 3 August 1976; ECHA, BAC 136/1987/838, Proposition d'une 'emergency assistance' à la Chine, Dablanc, Brussels, 4 August 1976.

155

Associated Press reported the proposal on 4 August. 116 In an irritated message, the Quai d’Orsay asked Jean-Marie Soutou, the French permanent representative in Brussels, who had decided on a policy which so blatantly contradicted what the Nine had agreed.117 But the matter was settled because in the end the PRC declined any foreign assistance. Soames’ action did not cause more of a stir. It is not certain whether Soames knew about the Chinese principle of refusing foreign aid before he offered the emergency aid. It is also open to interpretation whether he knew about the Nine’s opposition to a concerted Community gesture. Yet, similar to his initiative in May 1975, this instance offers further evidence of how Soames carved out a diplomatic role for the Commission using the relationship with China. Soames simply by- passed the Nine, and created yet another fait accompli.

Premier Minister Zhou Enlai’s and Chairman Mao Zedong’s death on 8

January and 9 September 1976 respectively show further cases of Community diplomacy. No institution took action in the name of the Community as a whole. Only the Commission and the European Parliament sent messages of condolence.118 The attention the Commission paid to the PRC is depicted in its response to Zhou Enlai’s death. Wellenstein was ‘very anxious that the reaction should be immediate’ because of the importance the Chinese attached to matters of protocol. He did not even wait until Soames’ return from Bucharest to arrange for Ortoli to send a telegram of regret to Mao and

Zhu De, the president of the Permanent Committee of the National Popular

116 AMAE, E-CE, 4196, Aide de la Communauté à la Chine, Noiville à Delfra Bruxelles, Paris, 5 August 1976. 117 Ibid. 118 On the EP: Centre Archivistique et Documentaire, Luxembourg (CARDOC), Correspondance, PE1 P1 244/EXET EXET/1979/230, Spénale to Li Lianpi, 10 January 1976; CARDOC, Correspondance, PE1 P1 244/EXET EXET/1979/230, Spénale to Li Lianpi, 9 September 1976.

156

Assembly of China. 119 Moreover Wellenstein arranged that he himself, de

Kergorlay and Klein went to the Chinese embassy to meet Li Lianpi to hand over messages of condolence from Ortoli and Soames, and sign the book of condolence.120 Similarly, when Mao Zedong died eight months later, Ortoli sent a message to the Permanent Committee of the National Popular

Assembly and Premier Minister Hua Guofeng.121 Ortoli’s choice of words led

Hannay to remark to Soames that ‘You cannot get much more purple than that.’122 Ortoli again only spoke in the name of the Commission rather than of the entire Community. In the context of a relationship that was in its infancy, and had so far proved of rather limited economic and political scope, these diplomatic gestures were significant in order to cement the European

Parliament and Commission’s roles in liaising with the Chinese government.

fter Soames’ initiative in Beijing in May 1975, the Commission set out to avoid being in the position of demandeur in relation to the Chinese government. This stance was reflected for instance de Kergorlay’s brief to

Ortoli for the latter’s lunch with Li Lianpi in October 1975 during which he was to discuss the trade talks. 123 But from February 1976 to the end of

Soames’ term as vice-president of the Commission it proved impossible to avoid being a demandeur. De Kergorlay summed up matters soberly to

Hannay on 14 May 1976:

119 ECHA, BAC 136/1987/838, Hay to Soames, 9 November 1976; ECHA, BAC 136/1987/838, Ortoli to Chu The, Brussels, 9 January 1976; ECHA, BAC 136/1987/838, Ortoli to Mao Zedong, Brussels, 9 January 1976. 120 ECHA, BAC 136/1987/838, Relations avec la Chine, Décès du Premier Ministre Chou Enlai, Klein, Brussels, 9 January 1976. 121 ECHA, BAC 136/1987/838, Ortoli to Huan Hsiang, Brussels, 9 September 1976. 122 ECHA, BAC 136/1987/838, hand-written side note, Hannay to Soames, 9 September 1976 on Ortoli to Huan Hsiang, Brussels, 9 September 1976. 123 ECHA, BAC 136/1987/624, Déjeuner avec l'Ambassadeur de la R.P.de Chine, Kergorlay to de Margerie, 13 October 1975.

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‘Lors du voyage à P kin de Sir Christopher Soames, nous avions invit l’Institut de Relations Internationales à nous rendre visite. Malgré un accord de principe, aucune date n'a été avancée du côté chinois pour concrétiser ce voyage et nos entretiens de cette semaine ont montré que les Chinois n'étaient nullement pressés. Par ailleurs, nous avions suggéré dans le cadre de nos conversations au sujet de la conclusion d'un accord que des fonctionnaires de Pékin viennent directement discuter à Bruxelles. Nous n'avons reçu ni acceptation ni refus mais les faits ont montré que personne n'est venu. Les missions économiques chinoises viennent régulièrement dans les Etats membres et récemment une mission est venue au Benelux dans le cadre d'une Commission Mixte. Les missions n'éprouvent pas le besoin, pour le moment, de [illisible] de leur passage pour discuter avec nous.’124

Although within the Community work on the EC-PRC relationship had continued in different institutions, at various levels, with different intentions and with varying degrees of intensity, Soames expressed his regret at his farewell meeting with Huan Hsiang in December 1976 that the relationship to which he ‘personally attached great importance’ had not progressed much further.125

Following Li Lianpi’s accreditation in September 1975 the European

Parliament and the Commission continued as the two institutions which consistently sought to improve the political dimension of the EC-PRC relationship. The Commission also sought to work together with the

European Parliament to establish the Community as a diplomatic actor in its own right. The call for a common European policy towards China in

Tindemans’ report on a European Union did not significantly change the laissez-faire attitude of the European Council, the Council of Ministers and

124 ECHA, BAC 3/1978/1517, Voyage en Chine de fonctionnaires des services de presses et d'information, Kergorlay to Hannay, Brussels, 14 May 1976. 125 ECHA, BAC 48/1984/687, Farewell meeting with Chinese ambassador, Richardson, Brussels, 10 December 1976.

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COREPER. Between February 1976 until January 1977 the EC-PRC relationship stagnated.

Soviet alarm and the reactivation of EC-COMECON talks

In contrast to the stand-still in the relationship with the PRC, the relationship of Community vis-à-vis the Soviet bloc did not stagnate, and the China factor played a role in this. The setting up of official relations with the PRC and the beginnings of talks for a trade agreement provoked reactions from the

Kremlin, individual Eastern European countries, and COMECON. The

Chinese kept a close watch on each of these developments and communicated their adverse views on these to the Commission too.

The unofficial contacts between the Commission and Eastern European diplomats like Stehno, the first secretary of the Czechoslovak embassy in

Brussels, show how closely Eastern European countries followed the

Commission’s activity in relation to China. They even inquired directly what the Commission’s objectives were.126 A further example was how Jan Zoubek, editor of the East-West journal, informed Klein about the considerable concerns in Eastern Europe over the opening to China.127 Partly due to that concern Zoubek expected COMECON to resume talks with the Commission which had started in Moscow in February 1975. Apparently most of the

Eastern European countries opposed the Soviet Union’s refusal to negotiate with the EC. He therefore anticipated that some of them would violate the

COMECON rules to discuss partial or technical agreements with the EC to

126 HAEU, Papers of Emile Noël (henceafter EN) 1987, Contact avec diplomates de pays de l'Est, Stefani to Meyer, Brussels, 6 July 1975. 127 ECHA, BAC 136/1987/624, letter, Zoubek to Klein, Brussels, 6 May 1975.

159 help alleviate their economic problems. Zoubek suggested that the

Commission should take measures regarding EC imports from Eastern

Europe to reduce the adverse impact of the prospective agreement with

China.128

The diplomats of the member states reported two kinds of reactions from Eastern Europe. From Hungary, the French ambassador Raymond

Bressier informed Jean Sauvagnargues, French Foreign Minister, about the disquiet caused.129 The official news agency of the Hungarian government, the

Magyar Hirlap, viewed the Chinese move as directed against Moscow.

Bressier thought that the unilateral criticism of the PRC was intended to remind the West that the Hungarian government would take it badly if the

Community played along with Chinese designs. Although Hungary sought to liaise with Western Europe, and had expressed dissent within COMECON, it still firmly backed Moscow’s line in foreign policy. 130 Albania in contrast welcomed the move. This was not surprising considering that in 1961 Albania had broken off relations with Moscow, and it supported the PRC not least since the Sino-Soviet split in the 1960s.131 Abdi Beleta, director of the Second

Directorate at the Albanian Foreign Ministry and in charge of relations with

China, keenly told François Desbans, French Ambassador to Albania, that his government shared with Beijing the opposition to Soviet aims. Albania

128 ECHA, BAC 136/1987/624, Zoubek to Klein, Brussels, 6 May 1975. 129 AMAE, AO, prov. 2158, La Chine et l'Europe, Bressier to Sauvagnargues, Budapest, 27 May 1975. 130 On the dissent see for example: Kansikas, 'Trade Blocs and the Cold War', pp.72–79. 131 Richard J. Crampton, Eastern Europe in the Twentieth Century - and After, (London, New York: Routledge, 1997), p.311.

160 wished Europe had the capacity to oppose the Soviets.132 The condemnation about the PRC engaging officially with the Community on the one hand, and the support given to the PRC on the other reveal the continuing fragmentation of the Communist world. The reactions to the EC-PRC relationship epitomise the growing challenge that the Kremlin faced in controlling Eastern Europe.133

The reports heightened the member states’ caution when deciding on the future course of EEC-USSR and EEC-COMECON relations. The Quai d’Orsay for example remarked that:

‘si - comme on peut le penser - l'URSS établit des relations des pays d'Europe de l'Est avec la Communauté, un déséquilibre pourrait se trouver crée dans les relations extérieures de la CEE vis-à-vis de l'URSS et de la Chine. On sait en effet que Pékin vient d'accréditer un ambassadeur auprès de Communautés et que des négociations commerciales CEE-Chine pourraient être engagées dans les prochains mois.’134

The European Parliament was quick to ask the Commission for its opinion on the issue. This illustrates how the Cold War transposed directly into the workings of the EC. During the debate on 18 June Kirk put it to Soames:

‘Clearly it is of interest to us to know what is the Commissioner's assessment of the effect of this development [the opening to China] on our relationship with the state trading countries to the East of us, with whom our relations up to now have been of a rather prickly nature.’135

132 AMAE, AO, prov. 2158, Entretien avec M. Abdi Baleta, problèmes européens, Desbans to Adresse Diplomatie Paris, Tirana, 27 May 1975. 133 See for example: Kansikas, 'Trade Blocs and the Cold War'. 134 AMAE, Série DE-CE, 1967–1975, 1064, Relations CEE-CAEM (1), 23 September 1975. 135 Debates of the European Parliament, Report of Proceedings from 16 to 20 June 1975, Official Journal C 192, 1975.

161

Soames in response addressed critics who thought that the Chinese willingness to negotiate a trade agreement with the Community was likely to inhibit the Soviet Union and Eastern European states from doing so too. He stated that

‘These governments will make their own judgements for their own reasons on when they will be ready to treat with the Community as such on commercial matters, as does not only China but the whole of the rest of the world.’136

Talking to the European Parliament, Soames did not believe that Chinese actions could influence the Soviet decisions in this matter.137

But Soames’ statements in public did not entirely correspond with the politics he, his cabinet and DG I pursued. Hannay, Wellenstein and Maslen all pointed out that in the final analysis, the decision to engage with China was to a great extent about geopolitics, about the wish to pressurise the

Soviet Union to engage with the European Community as a political and economic actor in its own right. 138 They believed that the opening of negotiations for an EEC-PRC trade agreement might have a galvanising effect on the Eastern European countries’ attitude towards the Community.

COMECON’s alarm over the PRC’s improving ties with the Community became more apparent when the Commission moved closer to the next phase of negotiations for the EC-PRC trade agreement . Suddenly COMECON stepped up its interest in the EC. On 9 February 1976 Gerhard Weiss, chairman of the COMECON Executive Committee and vice-president of the

136 Ibid. 137 Ibid. 138 Interview, Edmund Wellenstein, The Hague, 6 January 2010.

162

German Democratic Republic, proposed the conclusion of an agreement with the EC.139 This was one of the first signs of COMECON’s wish to reactivate talks since Edmund Wellenstein’s visit to Moscow a year earlier. According to the Nine, a primary reason for this fresh approach was of domestic nature. In light of the impending CPSU Congress, Soviet leader Leonid Brezhnev sought to use this proposal to present the Soviet Union as progressive and ready for compromise.140 The Commission however was well aware of the possibility that COMECON might also be reconsidering its policy towards the

Community because of the progress in the EC-China relations.141

The Chinese kept track of the new developments. They inquired about

COMECON’s initiative during the fifth meeting for trade talks with the

Commission on 18 February. 142 And they approved of the Council of

Ministers’ reply to the COMECON initiative. That reply stated that the

Community was willing to negotiate an agreement on acceptable procedures.

The Council reiterated that it was ready to begin trade negotiations only with individual CMEA member countries.143 Huan Hsiang commented to Soames

139 Kansikas, 'Trade blocs and the Cold War', p.208 140 NA, FCO 98/131, EEC/CMEA Relations, Alexander to Arbuthnott, London, 18 February 1976; NA, FCO 98/131, Council of Ministers, EEC/CMEA relations, EID (external), 27 February 1976; NA, FCO 98/131, Groupe d'experts Europe de l'Est: réunion du 14 avril 1976, Lux Coreu to all Coreu, Luxembourg, 15 April 1976. 141 ECHA, BAC 136/1987/624, Jan Zoubek to Klein, Brussels, 6 May 1975. 142 ECHA, BAC 136/1987/624, Fifth meeting with representatives of the Chinese mission, 18 February 1976, Maslen, Brussels, 23 February 1975. 143 European Commission, Twelfth General Report on the Activities of the European Communities in 1978, (Brussels: EEC, 1979), p.285.

163 in his farewell discussion in December 1976 that he ‘believed that the

Community had made an “intelligent response” to Comecon’.144

The upgrading of the EC-PRC relationship between May 1975 and

January 1977 led to more contacts between the Community and individual

Eastern European countries, the Soviet Union, and – at least in the opinion of the member states and the Community officials – with COMECON. The EC’s opening to China continued to contribute to détente in Europe because it provoked quantitatively and qualitatively new exchanges between the two sides of the Iron Curtain.

Conclusion

The momentum in the EC-PRC relationship following Soames’ initiative did not last long. Starting in February 1976 a year-long stand-still began due to

Chinese domestic paralysis. This emphasised how much any progress in the relationship was dependent on the Chinese government, and how unpredictable the relationship remained. But still the Community’s dealings with the PRC between May 1975 and January 1977 bring into the open four ways in which the Community persisted in shaping its role in external relations. It therefore shows that the opening of the Community to the PRC continues to challenge the picture of European integration in the 1970s as one of ‘Eurosclerosis’.

144 ECHA, BAC 136/1987/624, Fifth meeting with representatives of the Chinese mission, 18 February 1976, Maslen, Brussels, 23 February 1975; ECHA, BAC 48/1984/687, Note for the record, China, Richardson, Brussels, 10 December 1976.

164

First, the Community succeeded in setting up official relations with an accredited Chinese ambassador in Brussels in September 1975. Second, the

Commission began talks for an EEC-PRC Trade Agreement. Even though these temporarily came to a halt in February 1976, they still lay the groundwork for the eventual conclusion of the agreement. They were fundamental to carve out an advantageous position in the Chinese market against the competition from the United States. Third, concerning the Community’s position in the Cold War, the accreditation and the beginnings of trade talks based on the 1974 Outline agreement meant a first in the Community’s relationship with the Communist world.

Finally, the period shows the progressive maturing of the EC internal decision-making regarding external relations. The member states maintained their hands-off attitude at Community level. The Commission pursued its role as the institution to lead the EC-PRC relationship. It worked not least through the newly created European Council to push for progress. The

European Council proved a channel which the Commission used to assert its role within the Community in external relations, rather than a political actor in its own right that set the agenda. The European Parliament continued to use the relationship as a way to further its competences.

On 8 December 1976, David Ting, administrator at the Division for

Relations with State Trading Countries at DG I of the Commission, explained in an internal communication that the PRC government held the Gang of

Four responsible for having sabotaged China’s foreign policy. Hua Guofeng succeeded Mao as chairman of the Central Committee of the CCP and chairman of the Military Affairs Commission. He had ordered the arrest of

165 the four leaders. Now, the road was clear to reactivate the trade relations.145

The disruption in Chinese politics also accounted for the failure to respond to

Soames’ letter of 1 pril 1976 to Li Jiang. Hannay remarked on Ting’s note that this explained much, whilst Soames commented: ‘I suspect this will see some movement in 1977.’146 And movement did indeed come about.

145 ECHA, BAC 136/1987/624, L'importance du commerce extérieur est confirmée en Chine, Ting to Kawan, Brussels, 8 December 1976. 146 ECHA, BAC136/1987/624, L'importance du commerce extérieur est confirmée en Chine, Ting to Kawan, Brussels, 8 December 1976; handwritten remark by Hannay 13 December 1976; handwritten remark by Soames, 21 December 1976.

166

A multi-level deal (February 1977 – June 1978)

‘The Russians were fond of talking about the march of history. In this case they were in great danger of being left behind, and greatly to their own disadvantage. The kind of difficulties that had arisen with the fisheries agreement were only an indication of other more serious ones which would arise in the future if the Russians maintained their present attitude. In this respect I referred to the happy development of our relations with China.’1

Crispin Tickell, December 1977

‘En effet, c'est la première fois que la Communaut en tant que telle s'engageait dans une négociation bilatéral destinée à établir un lien contractuel avec un "pays à commerce d'état" l'ayant reconnu officiellement et entretenant avec elle des relations diplomatiques. Ce faisant, et indépendamment de l'intérêt économique de l'entreprise, elle souhaitait, d'une part donner quelque éclat a sa reconnaissance par un membre éminent du camp socialiste et, d'autre part, créer un précédent utile avance que ne s'engage, en mai 1978, la négociation avec le Comecon.’2

Luc Barre de Nanteuil, February 1978

On 14 February 1977, Huan Hsiang went to see Wilhelm Haferkamp, the new

Commission vice-president responsible for external relations, to announce that the PRC government wished to continue as quickly as possible with discussions for a trade agreement.3 The French Permanent Representative, de

Nanteuil, noted the intensity with which the Commission and the Chinese

1 Private papers shown by N. Piers Ludlow, Note for the record, Tickell, Brussels, 14 December 1977. 2 AMAE, Série DE-CE, NC, 1369, Accord CEE-Chine, Nanteuil to Adresse Diplomatie Paris, Brussels, 6 February 1978. 3 ECHA, BAC 259.80 PVS, 419, 23 February 1977; Compare: Kapur, China and the European Economic Community, p.42.

167 took up contacts again. 4 Only a little over a year later, on 3 April 1978,

Haferkamp signed the EEC-PRC Trade Agreement in Brussels. In his speech at the signing ceremony the Commission Vice-President stressed: ‘L’accord commercial entre la Communauté européenne et la République populaire de

Chine est empreint non seulement d’une signification conomique, mais aussi, et surtout, d’une signification politique.’5

This chapter shows that politics more than economics continued to be at the forefront of the negotiations for the trade agreement. Of the period up to

1980, the phase between February 1977 and June 1978 was the one of the most intense interaction amongst the different Community institutions.

Contrary to a common view in European integration history that ‘the conflict between the Council and the Commission, latent ever since 1965, produced a condition of immobility’ in Community politics, the interaction in the negotiations for the trade agreement tended to be cooperative, and effective.6

Whereas the Chinese government was primarily the actor that set the pace and timing for the conclusion of the trade agreement, it was the Commission which succeeded in negotiating an agreement largely in the Community’s favour. The renewed intensification in the EC-PRC relationship also paralleled that in the EC-COMECON one, and the Commission took advantage of this to assert itself both vis-à-vis the member states and vis-à- vis the Chinese. The historiography on the Cold War and European

4 MAE, Série DE-CE, NC, 1369, CEE-Chine, Brussels, Nanteuil to Diplomatie Paris, 24 February 1977. 5 ECHA, BAC 48/1984/687, Discours de M. Haferkamp, Vice-Président de la Commission des Communautés europ ennes, à l’occasion de la c r monie de signature de l’accord commercial CE/Chine, Brussels, 3 April 1978. 6 Middlemas, Orchestrating Europe, p.90.

168 integration fails to pick up on this milestone in East-West relations, which not least the opening quote of this chapter refers to.

First, the chapter examines the continuation of the trade talks up to the start of their exploratory phase. Of particular interest is the way in which the

Commission convinced COREPER to move forward with the trade talks, and how the European Parliament stepped up the game. Second, the chapter investigates the exploratory phase, particularly the results of de Kergorlay’s mission to Beijing in July 1977. Third, the chapter analyses the official negotiations between the Chinese and the Community in Brussels, and finally the signature of the agreement.

Swift resumption of trade talks which the Sino-Soviet rivalry spurs on

Following a year of paralysis, the dossier concerning an EEC-PRC Trade

Agreement suddenly picked up speed. In parallel, the Sino-Soviet competition for relations with the EC grew. The Chinese invited a

Commission delegation to Beijing to begin the exploratory phase. 7

Haferkamp responded enthusiastically and took charge. The European

Parliament too sought to bolster its role within the Community with its work on the trade agreement. The fresh impetus to the rivalry between Moscow and Beijing that the trade talks produced meant that the Nine were quickly convinced of the need to move swiftly. After close consultations with

COREPER, Haferkamp sent a high-level delegation to Beijing in July 1977.

7 ECHA, BAC 48/1984/687, Directorate General for External Relations to Members of Commission, undated.

169

The reactivation of EEC-PRC relations caused friction between the

Commission and the member states in defining the Commission’s room for manoeuvre in the trade talks. What the Commission wanted was to open the exploratory phase with the Chinese in Beijing. De Kergorlay summed up the status of the discussions with the Chinese, in a secret report to COREPER and expressed himself firmly in favour of a visit.8 He reassured the member states that under no circumstances would the visit by a delegation sent by the

Commission constitute the start of official negotiations. He also undertook in case of such a visit to inform the member states’ representatives on the spot about the contacts with the Chinese authorities, and upon return to Brussels to report to COREPER. Furthermore, he insisted on the inclusion of a safeguard clause to reassure the member states. 9 But still it took the

Permanent Representatives several meetings before consenting on 26 May

1977 to the Commission’s mission.10 The French and German representatives sought to limit the Commission’s task to simply listening to the Chinese.11 But the Commission applied incessant pressure during meetings with COREPER, and Kawan convinced the member states because the Cold War logic came into play.

8 CMA, Intermediate Archive, 19642/1977, Document de travail en vu de l'invitation du gouvernement chinois à la Commission de se rendre à Pékin pour préparer les négociations ultérieures d'un accord commercial, 15 April 1977. 9 CMA, Historical Archive, CM2, CEE CEA 19642/1977, Communauté-Chine, de Kergorlay, 15 April 1977. 10 ECHA, BAC 48/1984/687, 852ème Comité des Représentants Permanents, réunion du 28 avril 1977, Bruxelles, Chine, 29 April 1977. 11 CMA, Intermediate Archive, Réunion du 6 et 16 mai 1977 du Groupe restreint 'Chine', conclusions reprises dans une note secrète du Conseil du 17 mai 1977, undated; AMAE, Série DE-CE, NC, Relations entre la Communuate et la Chine, Nanteuil to Ministre de l'économie et des finances (DREE), Ministre du commerce extérieur et 'Directeurs', 9 May 1977; NA, FCO 98/299, EEC/China, Senior Collaborators Group: 16 May, Maitland to FCO, Brussels, 16 May 1977.

170

The Commission used to its advantage the parallelism of the new momentum in the EC-China connection and the Community’s relations with

COMECON to gain leverage. Once the Chinese resumed contact with the

Commission, COMECON replied to the Council of Ministers’ letter of

November 1976. It now accepted what it had previously opposed: direct negotiations with the Commission rather than only with the Council of

Ministers. This was significant because it meant COMECON implicitly recognised the competences of the Commission as a supranational institution speaking for the European Community.12 Consequently de Kergorlay advised

COREPER in March 1977 to think carefully about the timing the Chinese envisaged for the delegation’s visit because it coincided with the CSCE

Belgrade Conference. 13 De Kergorlay used this as a reason for changing the timing. His arguments reflect the dual motivations behind the Commission’s tactics. On the one hand it signalled to the member states its willingness to play the China card vis-à-vis the Soviets, and the Soviet card vis-à-vis the

Chinese in order to maximise the benefits for the Community as a whole. On the other hand it reflects the tactic of using the Cold War logic in order to carve out the Commission’s institutional authority vis-à-vis the member states to shape the Community’s foreign policy activity.

The COREPER ‘China’ working group also came to the conclusion to use the dynamic between the PRC and COMECON. As far as the French were

12 Compare: Kansikas, 'Trade Blocs and the Cold War; Takeshi Yamamoto, 'The Road to the CSCE, 1969-1973: Britain, France and West Germany', International History, London School of Economics and Political Science, 2009. 13 ECHA, BAC 48/1984/687, 850ème réunion du Comité des représentants permanents – 31 mars 1977, Relations avec la Chine, Stefani, Brussels, 5 April 1977.

171 concerned, Yves Cousein, deputy secretary-general of the prime minister, wrote to the French Permanent Representative in Brussels:

‘En tout tat de cause, la mise au point ult rieure du mandat de négociation proprement dit devra tenir compte de l'évolution globale des relations de la CEE avec les pays à commerce d'Etat, des discussions avec le CAEM et de la Conférence de Belgrade et s'inscrira donc dans le cadre d'une approche globale.’14

On 7 May, COREPER recommended that the Commission ought to take up the Chinese invitation to visit Beijing fairly soon.15

Along with the Commission, the European Parliament stepped up its effort to shape the new momentum of the EEC-PRC trade talks in order to bolster its institutional standing. Its efforts are shown by the queries during

Question Time and the number and nature of written questions submitted just after the Chinese invitation of a Commission delegation to Beijing.16 Willy

Dondelinger, from Luxembourg and MEP of the Socialist Group, asked the

Commission, for instance, why preliminary talks on a possible trade agreement had been broken off a year ago, and why they were now about to resume.17 Berkhouwer exercised pressure upon the Commission to keep the

Parliament informed throughout the negotiations, and stressed their political

14 AMAE, Série DE-CE, NC, 1369, Relations de la Communauté avec la Chine, Cousin to the French Permanent Representative in Brussels, Paris, 16 May 1977. 15 NA, FCO 98/299, Senior Collaborators Group: 6 May 1977: EEC/China, Maitland to FCO, Brussels, 7 May 1977. 16 Written Question No. 8/77, by Mr Dondelinger to the Commission of the European Communities, Official Journal C 148, 1977; Written Question No. 12/77, by Mr. Berkhouwer to the Commission of the European Communities, Official Journal C 180, 1977; Written Question No. 75/77, by Mr. Cousté to the Commission of the European Communities, Official Journal C 180, 1977; Oral Question No. 10, by M. Dalyell to the Commission of the European Communities, Official Journal C 212, 1977. 17 Written Question No. 8/77, Mr. Dondelinger to the Commission of the European Communities, Official Journal C 148, 23 June 1977.

172 importance.18 Some of the questions also reveal how the European Parliament sought to position itself in the relationship between the Commission and the

Council of Ministers. Pierre-Bernard Cousté, French MEP of the Group of

European Progressive Democrats, asked on 28 March 1977 if the Commission had already discussed the terms of reference for the trade agreement with the

Council of Ministers. 19 And precisely at the moment the Commission’s delegation to China was about to head off to Beijing, the European

Parliament Committee on External Economic Relations issued a report on economic and trade relations with China. 20 The French MEP Gabriel

Kaspereit of the Group of European Progressive Democrats headed the group and acted as rapporteur. The report called for broad economic cooperation with the PRC going beyond what the Commission and the Council of

Ministers envisaged.21 Thus, alongside the typical written and oral questions, the European Parliament also sought to underline its expertise via its working groups.

To further increase its visibility, the European Parliament debated and adopted on 5 July a resolution endorsing the Kaspereit report. The resolution also called for the Council of Ministers and the Commission to report regularly on the progress of the negotiations.22 Although this resolution may

18 Written Question No. 12/77, by Mr. Berkhouwer to the Commission of the European Communities, Official Journal C 180, 28 July 1977. 19 Written Question No. 75/77, by Mr. Cousté to the Commission of the European Communities, Official Journal C 180, 28 July 1977. 20 CMA, Intermediate Archive, 19643/1977, European Parliament Working Document 76/77; Compare: Kapur, China and the European Economic Community, p.38. 21 CMA, Intermediate Archive, European Parliament Working Document 76/77; Compare: Kapur, China and the European Economic Community, p.38. 22 European Parliament Resolution on economic and trade relations between the EC and the PRC, Official Journal C 183, 1 August 1977.

173 have had little effect, it contributed to the visibility of the European

Parliament. When the European Parliament nearly postponed the debate because the discussant was late, the intervention by Lucien Radoux, a Belgian member of the Socialist group, illustrates the importance some MEPs attached to the European Parliament fulfilling its role:

‘Our relations with a country like the People’s Republic of China are extremely important. In spite of the late hour I would advocate that we discuss this report today. It would be after all rather strange if we were to postpone it for another three months when a delegation is going to China and preparations are being made to open negotiations. If Parliament wants to play its proper role, then it should be examining this report today.’23

Other channels served the European Parliament too. Lord Frederick

Bessborough, Deputy Leader of the European Conservative Group, for example sent letters to the Commission suggesting ways to finance trade with the PRC.24 He also suggested that the Council of Ministers organise a joint meeting with the Commission and the European Parliament when the

Chinese Minister for external trade was visiting Europe. 25 Hence the

European Parliament kept on elbowing its way into discussions about EC-

China the trade talks.

February 1977 marked the beginning of rapid progress towards the conclusion of an EEC-PRC Trade Agreement. Primarily this was because the

Chinese reinitiated contacts. On the Community side, the Commission

23 Debates of the European Parliamen, sitting of Tuesday 5 July 1977. 24 ECHA, BAC 48/1987/687, Second letter from Lord Bessborough, Brussels, 14 October 1977; see also: Debates of the European Parliament, Report of the Proceedings from 19 to 14 October 1977, Oral Question No. 8 and 34, Official Journal C 221, 1977. 25 ECHA, BAC 48/1987/687, Second letter from Lord Bessborough, Brussels, 14 October 1977; Debates of the European Parliament, Report of the Proceedings from 19 to 14 October 1977, Oral Question No. 8 and 34, Official Journal C 221, 1977.

174 remained in the driving seat. It asserted itself successfully vis-à-vis the member states by resorting to Cold War logic. The European Parliament kept on claiming a say on the China dossier too and proved the EC institution that pushed for the most comprehensive version of a trade agreement with the

PRC.

Off to Beijing for the second time: the Commission’s skills

On 4 July 1977 Haferkamp sent a delegation headed by de Kergorlay to

Beijing. His decision did not lead to much debate between the

Commissioners, to judge, at least, from the minutes of the Commission’s weekly meetings.26 Haferkamp and DG I were the ones that determined the direction and pace of EEC-PRC relations. The aim was that de Kergorlay and the Chinese would agree on the outline of a trade agreement on the basis of which the Commission would ask the Council of Ministers for a negotiation mandate. De Kergorlay’s successful visit allowed the Commission to send a recommendation to the Council of Ministers to open formal negotiations. The growing Sino-Soviet antagonism over contacts with the EC proved to be more and more of an asset for the Commission vis-à-vis the Chinese. On 21

November the Council of Ministers gave the Commission the mandate for official negotiations.

In Beijing, de Kergorlay started in a strong negotiating position because the Chinese made clear that they attached high economic importance to the rapid conclusion of an agreement.27 High-ranking Chinese officials including

26 ECHA, BAC 48/1984/687, PV de la 436e réunion de la Commission, Bruxelles, 22 June 1977. 27 ECHA, BAC 48/1984/687, Recommandation de la Commission, Exposé des motifs.

175

Zheng Dobin, the director responsible for industrialised countries at the foreign ministry, and even Li Jiang warmly received the Commission’s delegation and held extensive discussions with de Kergorlay’s team.28 Overall, the tone and atmosphere of the discussions, which lasted nine days, were warm and cooperative, and the delegation characterised the visit as useful and fruitful. 29 However frictions over the content of the agreement crystallised too.

New controversies arose. The Chinese refused a clause that specified the geographic area to which the agreement would apply. The Federal Republic of Germany insisted on having such a clause because it wanted to remove any ambiguity over whether the agreement also applied to the German

Democratic Republic. But the PRC government refused to specify anything in order to circumvent the dispute on whether or not Taiwan belonged under the jurisdiction of the PRC. Furthermore, the Chinese refused a price clause, because they did not want to be restricted in their ability to export their products at a price the PRC decided autonomously. New requests arose too.

The PRC asked to be removed from the list of state trading countries and instead feature in the EEC list of GATT members. It also requested to be included in the Community’s GSP after the conclusion of the agreement. New progress also came about. This related to the two main difficulties of

‘balanced trade’ and the safeguard clause. The Chinese made concessions on

28 European Commission, Bulletin of the European Communities, 7/8, 1977, p.9; ECHA, BAC 48/1984/687, Recommandation de la Commission, Exposé des motifs. 29 ECHA, BAC48/1987/687, 865ème réunion du Comité des représentants permanents: 27 juillet 1977, Relations avec la Chine, Stefani aux MM. les membres de la Commission; European Commission, Bulletin of the European Communities, point 2.2.19, 7/8, 1979, p.9.

176 both issues.30 In a brief to the member states representatives in Beijing, de

Kergorlay admitted that ‘negotiations would not be easy but that the problems could be overcome. The Chinese would strike a hard bargain but the EC side should be prepared to be tough as well.’31 All in all though, de

Kergorlay’s mission proved crucial for a solution on the two points that the

Commission and Coreper had identified as fundamental for progress in discussion.

De Kergorlay’s mission spurred on the Sino-Soviet competition, and this worked to the Community’s advantage. Following de Kergorlay’s successful mission, Mihai Marinescu, deputy prime minister of Romania and then chairman of the COMECON Executive Committee, travelled to Brussels. He agreed to meet a Community delegation led by Haferkamp to discuss a possible agreement on 21 September. The meeting resulted in a joint communiqué, on the basis of which the two parties planned negotiations for early 1978.32 The British too now clearly perceived a competition between the

PRC and COMECON. The Cabinet Official Committee on European

Questions thought that the Chinese ‘also probably do not want their relations with the Community to be overtaken by any agreement that the Community and the CMEA might negotiate following their meeting on 21 September’. 33

Therefore the Europeans were aware that the timing and the sudden urgency the Chinese displayed in concluding a trade agreement with the EEC was

30 ECH , B C 259.80, P S , Recommandation de la Commission au Conseil concernant l’ouverture de négociations avec la République Populaire de Chine, Exposé des motifs, 28 September 1977. 31 NA, FCO 98/299, Visit of EEC delegation to China, Youde to FCO, Beijing, 11 July 1977. 32 European Commission, Twelfth General Report on the Activities of the European Communities in 1978, (Brussels: EEC, 1979), p.272. 33 NA, FCO 98/299, EEC/China, Commission proposal for a trade agreement, Cabinet Official Committee on European Questions, 14 October 1977.

177 linked to their rivalry with Moscow, which put the Europeans in a stronger negotiating position.

In terms of intra-Community dealings, COREPER favourably received de Kergorlay’s report of his mission, but did not expect a speedy conclusion of the matter. Joseph van der Meulen, the Belgian representative holding the chair, expressed COREPER’s doubts about a rapid conclusion pointing out that only with pure luck would the Council of Ministers agree on a negotiating mandate before the end of the year.34 But these doubts did not match the course of the story. The reasons were the speed with which the

Commission worked out the mandate, the ongoing pressure from the

European Parliament, and the pronounced and forceful interest demonstrated by the Chinese. Reflecting on the smooth and cooperative working process, Ian McCluney, FCO official in the European Integration

Department, wrote to Gerald William Hayward, FCO official in the Far

Eastern Department, on 11 November 1977 that ‘So far as I can see there has been no delay at all in reaching agreement on a mandate’.35 The Commission remained in the driving seat.

Although COREPER responded quickly and constructively to the

Commission proposals, it asserted its control over the precise contents of the trade agreement. The Commission’s limits lay where the member states’ interest came in. This is illustrated in the controversy over a clause on maritime transports. The Commission wanted to include such a clause in the

34 NA, FCO 98/299, Committee of Permanent Representatives, meeting of 27 July, EEC/China, Maitland to FCO, Brussels, 27 July 1977. 35 NA, FCO 98/299, McCluney to Hayward, 11 November 1977.

178 trade agreement. 36 But France, Germany, the Netherlands, Belgium,

Denmark and Italy had all recently concluded bilateral maritime agreements with China, in which the PRC granted to the Europeans specific national benefits. 37 Therefore most opposed the Commission. France for example had secured a most-favoured nation clause in the Sino-French maritime transport agreement of 28 September 1975. Britain also firmly obstructed the inclusion of such a clause in the EEC-PRC Trade Agreement. David Owen, British

Foreign Secretary, explained that Britain was ‘anxious’ to conclude a maritime agreement too. He feared ‘that a reference to maritime transport in the EEC negotiations mandate might be used by the Chinese as an excuse to back out of bilateral negotiations’ with them.38 The Danish were the only ones who supported the Commission’s endeavour. But eventually, they rallied to the majority on the condition that this agreement was not a precedent for future arrangements with other state trading countries. 39 In the end, Roy

Denman, Wellenstein’s successor as Director General of DG I, had to give up the Commission’s opposition albeit reluctantly.40

36 NA, FCO 98/299, Commission recommendation to the Council for the opening of negotiations with the People's Republic of China, report from the working party on trade questions to the Permanent Representatives Committee (1), Brussels, 25 October 1977; ECHA, BAC 48/1987/687, 865ème réunion du Comité des représentants permanents: 27 juillet 1977, relations avec la Chine, Stefani to Members of the Commission, Brussels, 29 July 1977. 37 ECH , B C 8/1987/687, Projet de recommandation de la Commission au Conseil concernant l’ouverture de négociations avec la Chine, Groux to Directorate General for External Relations, Brussels, 8 September 1977. 38 NA, FCO 98/299, Committee of Permanent Representatives, meeting of 10 November, EEC/China trade agreement, Owen to UK Rep Brussels, 8 November 1977. 39 NA, FCO 98/299, Committee of Permanent Representatives, meeting of 10 November, EEC/China trade agreement, Maitland to FCO, 10 November 1977. 40 NA, FCO 98/300, Committee of Permanent Representatives, meeting of 16 November 1977, EEC/China trade Agreement, Maitland to FCO, Brussels, 16 November 1977; CMA, Intermediate Archive, 19644/1977, 876ème réunion du Comité des représentants permanents, tenue à Bruxelles, du 16 au 18.11.1977, relations avec la République populaire de Chine, 18 November 1977.

179

But the Commission found other ways to affirm its part. For example, it sent the Council of Ministers only the outline of the clauses for the trade agreement on which its negotiation mandate was to be based, rather than a full draft of the clauses. This gave the Commission maximum room for manoeuvre in the negotiations with the Chinese. 41 Furthermore, the

Commission first issued a press release on its recommendation to the Council of Ministers for a negotiating mandate, and only a day later sent off this recommendation to the Council of Ministers. This meant that the

Commission sign-posted its role as a spokesman for the Community to the general public. Above all it meant that the Council of Ministers was now under more pressure to approve its mandate. If the Council refused the mandate, it could be publicly blamed for obstructing the trade deal with the

Chinese. Thus the Commission again resorted to its tactic of creating a fait accompli vis-à-vis the Nine to advance the EC-PRC relationship and, above all, to reaffirm its leadership role within it.

On 21 November 1977 the Council of Ministers adopted without discussion the directives for the Commission to open negotiations with the

Chinese. 42 With the exception of the clause on maritime transport, the member states had essentially approved the Commission’s proposal.43 The

French and the British welcomed the Council of Ministers’ decision. 44

41 Roy Denman confirmed this tactic: ECHA, BAC 48/1984/687, Note, Chine, Denman to Haferkamp, 18 November 1977. 42 Ibid. 43 ECHA, BAC 48/1984/687, Projet de recommendation de la Commission au Conseil concernant l'ouverture de négociations avec la Chine, Groux to DG I, Brussels, 8 September 1979. 44 AMAE, Série DE-CE, NC, 1369, Chine-CEE, 1 December 1977; NA, FCO 98/300, Annex, Brief No. 22, Council of Ministers (Foreign Affairs) Brussels, 22 November 1977, EEC/China, European Integration Department, 17 November 1977.

180

Therefore the Commission’s push for quick results by means of an early approach to the Council of Ministers for the mandate to begin official negotiations was successful. The Commission managed to complete the exploratory phase in record time. Such a quick authorisation was not self- evident. The case of the trade agreement with Yugoslavia shows that the

Council of Ministers delayed time and time again in 1978 to give the

Commission a mandate for negotiations.45 Similarly, the case of agreements with the Mediterranean states, Spain and Israel, the Maghreb states,

Morocco, Tunisia and Algeria, and the Mashrek states, Egypt, Jordan,

Lebanon and Syria, show the restricted role of the Commission. The member states decided by means of arduous discussions the detailed negotiating directives for the Commission to follow and abide by.46

By the end of 1977, the Commission was ready to lead formal negotiations with the PRC government. The Commission had acted quickly.

The main result of de Kergorlay’s mission to Beijing had been to find a solution to the technical deadlock over safeguard measures and a balanced trade clause. The Commission then completed the exploratory phase and secured a Council of Ministers mandate for official negotiations in almost record time. Still the limits of the Commission’s room for manoeuvre lay where the national interest of the member states came in. Yet in the case of the PRC, the interests of the different member states and the Commission vis-à-vis China were largely congruent, and therefore the Commission could

45 HAEU, EN 1092/1978, Yugoslavia, Tickell to Froschmaier, Brussels, 18 December 1978. 46 McAllister, European Union, p.104.

181 go ahead as quickly and as far as it did. Its tactic of fait accompli served the

Commission well once more.

The final negotiation phase: playing the Soviet card

On 22 December 1977 the official negotiations started in Brussels. On the

Community side, the Commission led the negotiations in close contact with the Nine working through COREPER and the rticle 113 ‘China’ Committee.

This last included representatives from both the Commission and the member states. It was responsible for overseeing the negotiations. The

Chinese and the Commission eventually worked out a deal because both sides wanted to make it work.

Within the Community, the workings of the rticle 113 ‘China’

Committee reflected the constructive working relationship which had been established between the Commission and the Nine. Denman reported once the negotiations concluded that:

‘We were able to carry the member states with us; indeed their help and advice throughout the long night of February 2 and 3 proved extremely valuable; they were kind enough to say at the end that they thought we had got more than had seemed to them at the outset likely.’47

The French also put it down to Denman’s negotiating skills and the unanimity of the member states that the negotiations had ended so satisfactorily.48 The rticle 113 ‘China’ Committee also shows how the parties dealt with national and Community interests. One example was the conflict

47 HAEU, EN 1092/1978, Trade agreement with China, Denman to Haferkamp, Brussels, 6 February 1978. 48 AMAE, Série DE-CE, NC, 1369, Accord CEE-Chine, Nanteuil to Adresse Diplomatie Paris, Brussels, 6 February 1978.

182 over the safeguard clause. At the meetings on 8 and 15 December the Belgian representatives brought back an issue which the British had tabled previously.49 They called for the re-introduction of the national right to apply interim protective measures in the case of an emergency. This right had ceased when the Community took over the administration of the trade agreements with third countries on 1 January 1975. Kawan reiterated that the question of the national application of such emergency measures constituted an internal problem which ought to be examined in a different forum. But on

6 January the British delegation had its way by including in the Council of

Ministers’ minutes a statement that, irrespective of a safeguard clause, the member states could still individually apply their own measures on protection against dumping.50 The conflict indicates how many pitfalls existed on the road to a successful EEC-PRC agreement. In the end the Commission’s ability to lead the negotiations with the Chinese to a successful conclusion was down to the member states essentially wanting the agreement too.

The final stage of negotiations began in Brussels on 30 January 1978 upon the arrival of a Chinese delegation from Beijing. The negotiations proved intense: they lasted four days, comprising five sessions, of which the last one started at 15:30 on 2 February and continued through the night until

8:30 the following morning.51 The challenging nature of the talks is further illustrated in a note by Denman to Haferkamp a few days after the

49 ECH , B C 8/198 /687, Comit 113 ‘Chine’ du 15.12.1977, Hasselhoff, Brussels, 19 December 1977 CM , Intermediate Archive, 19645/1979, Outcome of the proceedings of the Article 113 Committee (China), Brussels, 19 December 1977. 50 CMA, Intermediate Archive, 19645/1979, Outcome of the meeting of the Article 113 Committee on 5 and 6 January 1978, Brussels, 10 January 1978. 51 HAEU, EN 1092/1978, Trade agreement with China, Denman to Haferkamp, Brussels, 6 February 1978.

183 completion of negotiations describing the atmosphere as ‘at times dense’ so that ‘[i]ndeed at about 4 a.m. on the morning of February 3 the Head of the

Chinese delegation leapt from his chair in rage and seemed about to break.’52

Difficulties with the Chinese arose on the one hand for linguistic reasons, on the other hand because of substance. Almost every article led to lengthy discussions. The Commission ‘had to press hard’ and ‘fight very hard’. On the liberalisation clause the Commission prevented formulations that implied the rapid removal of quantitative restrictions of imports from China to the

Community. It also battled to include a reference to the promotion of contacts, trade fairs and visits. Finally and most importantly, regarding the safeguard clause, the Commission fought to include a reference which allowed the Community to take emergency action without prior consultation.

The Commission’s tactic vis-à-vis the Chinese was grounded in the belief that they ‘could afford to play it fairly rough’ because the PRC government obviously wanted to reach a deal. This tactic proved to be a consistent one throughout the three negotiation phases. For example in the exploratory phase, in order to include a price clause, which the Chinese initially refused completely, Denman had written to Haferkamp that

‘Il y aura lieu, je crois, de lui faire comprendre que les directives de négociation qui furent élaborées dans un temps record par la Communauté ne pourront être facilement changées. Dès lors si l’on veut conclure vite, il conviendra de trouver une solution dans le cadre de ces directives.’53

The Commission was prepared to play a tight game with the Chinese.

52 HAEU, EN 1092/1978, Trade agreement with China, Denman to Haferkamp, Brussels, 6 February 1978. 53 Kawan received the Chinese commercial councillor Li regarding the negotiations, see: ECHA, BAC 48/1984/687, Denman to Haferkamp, 18 November 1977.

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n additional factor that worked to the Commission’s advantage and spurred on the negotiations was the now openly irritated and adversial reaction of the Soviets regarding the EC-PRC relationship. And as the opening quote of this chapter shows, the Commission did play the China card. The quote is taken from a note in which Sir Crispin Tickell, the chef de cabinet of the new Commission President, Roy Jenkins records his discussions over lunch with Mr Kouznetsov, the first secretary of the Soviet embassy in Brussels in December 1977.54 On 31 January, Bruno de Leusse,

French ambassador in Moscow, informed the Quai d’Orsay:

‘ insi les Sovi tiques ne cachent plus leur irritation devant le développement des contacts entre l'Europe occidentale et la Chine. Ce n'est pas un hasard si la presse multiplie en même temps les attaques contre les dangers que les "provocateurs de Pékin" font courir à la consolidation de la détente (articles de la Pravda du 28 janvier - citant le rudo pravo - sur les liens que la Chine cherche, via la CEE, a établir avec l'OTAN, et du 31 janvier sur les encouragements de la Chine à la fabrication de la bombe à neutrons). Rien n'est négligé pour montrer aux pays membres de la Communauté européenne et en particulier au notre, qu'il n'est pas de leur intérêt de se prêter aux « manœuvres chinoises ».’55

The increasingly fierce Sino-Soviet competition allowed Denman to adopt a firmer negotiating position vis-à-vis the Chinese. During the final negotiations, Denman read out to the Chinese a communication by the Soviet news agency TASS, which fiercely condemned the Chinese for reaching out to the Community. 56 The French Permanent Representative reported how this provoked anger amongst the Chinese which spurred them on to conclude the

54 Private papers shown by N. Piers Ludlow, Note for the record, Tickell, Brussels, 14 December 1977. 55 AMAE, Série DE-CE, NC, 1369, Négociation d'un accord commercial entre la Chine et le marché commun, Leusse to Adresse Diplomatie Paris, Moscow, 31 January 1978. 56 AMAE, Série DE-CE, NC, 1369, Accord CEE-Chine, Nanteuil to Adresse Diplomatie Paris, Brussels, 6 February 1978.

185 negotiations ‘coute que coute’ so as to out-do the Soviets.57 This enabled

Denman ‘d'arracher in extremis dans la nuit du 2 au 3 février des conditions inesp r es’.58 Hence, Denman played the Soviet card to good effect.

The Commission made two main concessions to the Chinese. The first one was to include a ‘balance clause’ which stipulated that the party recording a surplus had to seek ways to re-establish equilibrium in trade exchanges. But in effect no obligations to take action existed, and the Commission ensured the insertion of the formula ‘each by its own means’ to take account of its market economy system. The second concession regarded quantitative restrictions. 59 The Community agreed to an increasing liberalisation and enlargement of the trade quotas applying to Chinese goods. Apart from these two main concessions, others were the exclusion of a clause on the supply of raw materials. The Community also agreed to leave out a definition of

Chinese territory. The EC granted China MFN status in Article 2. This carried strong political overtones because this status had proved elusive to the Soviet

Union within the CSCE framework and the negotiations for the Helsinki Final

Act.60 Granting the MFN clause looked like a concession, but was not. In the absence of a Community trade agreement, the Community had officially stated that it would continue to apply MFN rates.61 The MFN clause therefore did no more than prolong the status quo. Moreover the MFN treatment did

57 AMAE, Série DE-CE, NC, 1369, Accord CEE-Chine, Nanteuil to Adresse Diplomatie Paris, Brussels, 6 February 1978. 58 Ibid. 59 CMA, Intermediate Archive, 19649/1978, Memorandum, Results of the negotiations for a trade agreement between the EEC and the PRC, Brussels, 7 March 1978. 60 Ebinger, 'The Politics of Potential', p.338. 61 CMA, Intermediate Archive,19648/1978, EEC-China trade agreement, Council General Secretariat, Brussels, 9 March 1978.

186 not apply to quantitative restrictions. Therefore, in the final analysis, the

Community’s most important commitment to China was to increasingly liberalise the EC market.

The Chinese side also conceded on two major issues. The first one was to accept a safeguard clause (Article 7). Though the agreement did not make specific use of the term ‘safeguard measures’ and instead referred to ‘friendly consultations’ (Article 5), in essence this was no different to the usual safeguard clauses the Community applied. The parties could take unilateral measures in an emergency without prior consultation. ‘Friendly consultations’ would then follow. The second major concession was the inclusion of a price clause: however, it turned out to be less detailed than that which the Council of Ministers had outlined in its mandate to the

Commission.62 Next to these two main issues, the Chinese pledged to show

‘favourable consideration’ towards Community exports (Article 4). They also committed to support trade fairs, industrial and technical contacts between the two parties (Article 6). The Community regarded this as an important provision in relations with state trading countries consistent with the stance it took at the CSCE.63 On balance and at specific time in the history of the EC-

PRC relationship, the trade agreement leaned in favour of the Community.

On the basis of these mutual concessions, Denman, on behalf of the

Community, and Sun Suzhang, director of the Department of Foreign Trade,

62 CMA, Intermediate Archive, 19649/1978, Memorandum, Results of the negotiations for a Trade Agreement between the European Economic Community and the People’s Republic of China, Brussels, 7 March 1978. 63 Ibid.

187 on behalf of the PRC, initialled the Draft Trade Agreement on 3 February.64 It was a non-preferential trade agreement concluded for a period of five years with provisions for its renewal. Its aim was to promote and intensify trade between the two sides. Article 9 stipulated that a Joint Committee set up after the signature of the agreement was in charge of administering the agreement and was to meet normally once a year. The agreement proved to be just a general framework agreement, and a Joint Committee had to work out the details subsequently.

The Soviet reaction to the initialling of the trade agreement was severe.65

For the first time a Soviet embassy representative, E. Plakhotnyi, visited the

Commission in the Berlaymont, the Commission’s office in Brussels. On 20

February 1978, Plakhotnyi discussed the EC-PRC relationship and aired the

Soviet irritation directly to Umberto Stefani, First Counsellor of the

Commission’s General Secretariat. He stressed that as his government had predicted and feared, the Commission had given a particular political significance to the agreement. 66 Similarly, the Soviet minister-counsellor expressed his anger to the French Director of Far Eastern Affairs about the recent trade agreement and the absence of a clause that prohibited the sales of strategic materials.67 The hostility between Moscow and Beijing grew ever more intense.

64 CMA, Intermediate Archive, 19649/1978, Results of the negotiations for a Trade Agreement between the European Economic Community and the People's Republic of China, General Secretariat of the Council, Brussels, 7 March, 1978. 65 AMAE, Série DE-CE, NC, 1369, La CEE et la Chine, Leusse to Adresse Diplomatie Paris, Moscow, 7 February 1978. 66 HAEU, EN 1990, Visite de Monsieur E. Plakhotnyi, Stefani to Noël, 20 February 1978. 67 AMAE, Série DE-CE, NC, 1369, Accord CEE-Chine, Martin to de Guiringuaud, Belgrade, 7 April 1978.

188

With the EEC-PRC Trade Agreement initialed, the next step within the

EC was the Council of Minister’s endorsement of the deal. The negotiations had shown the basic political willingness from both the Community and the

Chinese to conclude a trade agreement. Therefore they found compromises on all of the main issues in dispute. On the Community side, the close cooperation between the member states and the Commission was fundamental to its effective negotiations with the Chinese. The tactic that succeeded vis-à-vis the Chinese was Denman playing the Soviet card.

Signature and ratification: the many dimensions of the trade agreement

On 3 April 1978 Haferkamp and the President of the Council of Ministers

Knud Andersen signed the EEC-PRC Trade Agreement with Li Jiang in

Brussels. Throughout the trade talks, the European Parliament had kept its eyes on the ball. On 1 June 1978, with the ratification procedure completed for both parties, the EEC-PRC Trade Agreement, the first one between the

Community and a state trading country based on the 1974 Outline

Agreement, entered into force.

Within the Community, the constructive working relationship between the Commission and the Nine continued. Haferkamp decided to inform the

Council of Ministers himself on 7 February rather than just instructing

Denman to do so at COREPER level. This also reflects the political importance the Commission attached to the deal.68 More importantly, the

68 H EU, EN 1906, Haferkamp’s intervention at the 500th Council of Ministers (Foreign Affairs) meeting, 7 February 1978.

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Commission pushed for a speedy signature. At the next COREPER meeting on 9 February, Denman suggested using the visit of a Chinese ministerial delegation to Europe at the end of March as the occasion to sign the agreement.69 In parallel, DG I drafted a recommendation for a Council of

Ministers regulation on the conclusion of the agreement. In order to have the

Council of Ministers decide on the matter at its session on 7 March, DG I used a ‘proc dure acc l r e’. s a result, the recommendation was ready on

21 February and sent to the Council of Ministers President Andersen the next day.70 The Nine responded at a similarly quick pace. On 2 March COREPER agreed on the results of the negotiations and recommended that the Council of Ministers decide to sign the agreement. 71 The Council of Ministers approved the agreement on 7 March without further discussion.

During the signature ceremony on 3 April 1978, both Andersen and

Haferkamp made clear that for the Community the significance of the EEC-

PRC Trade Agreement went beyond the purely commercial and beyond the

Community’s relationship to China. Andersen declared:

‘Chacun est conscient que la c r monie d’aujourd’hui a une port e qui dépasse le cadre purement commercial. Dès 1973, les Chefs d’Etat et de Gouvernement des Neuf, r unis à Copenhague, avaient exprim leur volont d’intensifier leurs relations avec le Gouvernement chinois. […] Cette politique, les Neuf la poursuivent dans le respect de leurs amitiés traditionnelles, avec la conviction que la société européenne de demain doit répondre aux aspirations profondes de ses peuples et avec l’espoir que la Communaut

69 CMA, Intermediate Archive, 19645/1979, 907ème réunion du Comité des représentants permanents, 12-14 juillet 1978, Relations avec la Chine, Brussels, 8 December 1980. 70 CMA, Intermediate Archive, 19648/1978, Recommendation for a Council Regulation, concluding the Trade Agreement between the European Economic Community and the People's Republic of China, presented by the Commission to the Council, Brussels, 22 February 1978. 71 CMA, Intermediate Archive, 19647/1978, 889ème réunion du Comité des représentants permanents, Brussels, 2 March 1978.

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pourra jouer le rôle d’un facteur d’ quilibre et repr senter un pôle de coopération avec toutes les nations, quels que soient leur dimension, leur culture et leur système conomique et social.’72

Haferkamp emphasised that the agreement reflected not just China’s support of the political project of the Community, but was also a symbol of the trust between the two parties crucial to overcoming the economic and political tensions in the current international climate. Furthermore:

‘Ce principe de la coop ration d termine aussi les relations extérieures de la Communauté européenne. Notre accord est un nouveau t moignage de cette d termination positive et il n’est dirig contre personne.’73

The Soviet Union was the implicit target of this last sentence. Both speeches indicate the politicised way the Community as a whole treated the negotiations for the EEC-PRC trade agreement, always viewing them in relation to the Soviet bloc.

Significantly, the Community's success in signing the trade agreement with China paralleled renewed advances by COMECON towards the

Community. Just before the EEC-PRC Trade Agreement entered into force,

Nicolai Fadeyev, COMECON secretary, received a Community delegation led by Haferkamp in Moscow on 29 and 30 May. As a result Haferkamp and

Fadeyev issued a joint memorandum in which they agreed a number of

72 ECH , B C 8/198 /687, C r monie de signature de l’accord commercial CEE-République populaire de Chine, Discours de Mr. K.B. Andersen, Brussels, 3 April 1978. 73 ECH , B C 8/198 /687, C r monie de signature de l’accord commercial CEE-République populaire de Chine, Discours de M. Haferkamp, Brussels, 3 April 1978.

191 principles and reiterated the wish to set up official relations between the

Community and COMECON.74

Notably, the Commission not only used the China relationship to put forward its authority internally within the Community, and externally vis-à- vis the Soviet bloc, but also in relation to the United States. When Roy

Jenkins visited American President Jimmy Carter, it was the Commission that put relations with the PRC on the agenda. A brief recommended Jenkins to ask about the prospects for development in Sino-American relations. It included as a defensive point the content of the EEC-PRC Trade Agreement advising the Commission President not to tell Washington too much. 75

Thereafter, over a lunchtime conversation with Secretary of State Cyrus

Vance on 18 April, it was the Commission which set the agenda on relations with China. Vance admitted that the Sino-American relationship had reached a deadlock.76 The Community was set to outpace the United States not only in the establishment of official relations, but also the conclusion of a trade agreement. Indeed, back in Brussels, Huan Hsiang confirmed this for the

Chinese side too. He remarked to Jenkins that trade with the United States was diminishing mainly for political reasons and that ‘there were no prospects for […] the establishment of full diplomatic relations.’ 77

ichitsorasatra rightly points out: ‘The fact that the EC and China managed to reach an agreement while this was not the case with the Americans is an

74 European Commission, Thirteenth General Report on the Activities of the European Communities in 1979, (Brussels: EEC, 1980), p.301. 75 HAEU, EN 1569, Visit to the U.S. 18 April and following days, Commission Secretariat General to Jenkins, Brussels, 5 April 1977. 76 HAEU, EN 1568, Conversation over lunch at the Department of State, Washington: 18 April 1977 at 1300 hours, Tickell, 3 May 1977. 77 HAEU, EN 1142, The Ambassador of China, Mr. Huan Hsiang, Reuter, Brussels, 16 November 1977.

192 indication of a high degree of willingness to cooperate between the Chinese and the Europeans.’78 The Community’s relations with the PRC suggest that the Commission was willing to move far ahead of the United States.

At the signing ceremony the European Parliament was not present but it did play a role in the intra-Community politics regarding the trade negotiations. It used the relations with China to implement an inter- institutional agreement, the so-called Luns-Westerterp procedure. This agreement had no legal basis in the Rome Treaties and showcases the way the

European Parliament increasingly elbowed its way into EC decision-making.

The agreement obliged the Council of Ministers to inform the European

Parliament of all decisive steps during the negotiations of a trade agreement.

Therefore, when the Commission began official negotiations, Nicolas

Hommel, Secretary-General of the Council of Ministers, had to forward to the

EP President a memorandum on the negotiations.79 And the day the Council of Ministers decided on the signature of the agreement, on 7 March, the

General Secretariat sent another memorandum this time analysing the content of the agreement with a copy of the draft agreement attached. 80

Finally, the Council of Ministers’ President himself spoke in front of the EP

Political Affairs Committee on 14 March about the EEC-PRC trade agreement.81 Even if these steps did not lead to any fundamental changes in the content of the trade agreement itself, they still deepened the links between the European Parliament and the Council of Ministers.

78 Vichitsorasatra, 'The Evolution of Cooperation between the European Community and East Asia', p.127. 79 CMA, Intermediate Archive, 19649/1978, Hommel to Colombo, 3 February 1978. 80 CMA, Intermediate Archive, 19649/1978, Hommel to Colombo, 9 March 1978. 81 CMA, Intermediate Archive, 19648/1978, Outline Speech, EEC-China Trade Agreement, 9 March 1978.

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The European Parliament also used the China dossier to increase its exchanges with the member states meeting through the EPC. 82 The

Luxembourg Report of 1970 that set up the EPC stipulated that the foreign ministers and the members of the EP Political Commission were to meet several times a year for a colloquium. The intention was to associate the

EPC’s work more closely with the representatives of the European people and give a democratic character to political unification.83 In preparation for such a colloquium, the EP Political Affairs Committee examined the negotiations with the Chinese government at its session on 21 and 22 February 1978.84 The discussion centred on the possible reactions of the Soviet Union, and reflected divergent points of views. Lord Brimelow of the Socialist Group, for instance commented that the Soviet Union could only react negatively. He advised not to insist on the political aspects of the agreement which could provoke the Soviet Union further. In contrast Carlo Alberto Galluzzi, a member of the Communist Group, thought that this agreement represented a development profitable for the Soviet Union since the Soviet government could counteract the ideological rigidity of the PRC. In the end the committee set out a list of questions including what the attitude the United States to the agreement was, what guarantees for protection the safeguard clause offered to the Community, what kind of trade development the EC could expect, and if the agreement was considered as a precedent for example in relation to

Romania. The workings of the European Parliament, the deliberations, the

82 CMA, Intermediate Archive, 19649/1978, Travaux parlementaires, réunion de la Commission politique de l'assemblée, Copenhague, 20/21 février 1978 (1), Le Conseil, Brussel, 23 February 1978. 83 The Luxembourg Report. 84 CMA, Intermediate Archive, 19649/1978, Travaux parlementaires – réunion de la commission politique de l'assemblée, Copenhague, 20/21 février 1978 (1), Brussels, 23 February 1978.

194 rhetoric and the political orientation of the intervening parties, further indicate the impact of the Cold War upon European integration. And similar to the Commission, the European Parliament brought the Cold War into play to bolster its role vis-à-vis the member states.

Parliamentary debates were a further way in which the European

Parliament manifested its role within the Community. The sitting on 11 April

1978 in particular demonstrates the ‘sense of excitement and urgency’ which the developments in relation to China provoked.85 The session is also useful in showing the significance attached to the agreement, ranging from the political to the economic, from the bilateral to the multilateral and global.

Those who emphasised the geopolitical aspect came from across the entire political spectrum, including from the European Conservative Group, the

Liberal and Democratic Group, the Christian Democratic Group, and the

Communist and Allies Group. But there were also those who emphasised the economic aspects much more, such as Lord Kennet from the Socialist Group or John Alexander Corrie from the European Conservative Group. The debate is also revealing of the Parliament‘s aspiration to see the Community’s role in world affairs further elevated. In particular Berkhouwer hoped that this agreement would contribute towards Europe’s fulfilment of its world role, and put forward the Third Force argument.86

The April debate is relevant too in terms of the European Parliament’s views on how the Community ought to operate in external relations. By

85 Debates of the European Parliament, Report of Proceedings from 10 to 14 April 1978, Oral Question No. 27/78, Official Journal C 1229, 1978. 86 Ibid.

195 discussing concrete ways to implement the trade agreement, the European

Parliament claimed its part in shaping the EC-PRC relationship. It continued to assume its role in holding the Commission accountable for its actions.

Lord Bessborough for example insisted ‘It would be useful to know from the

Commissioner by what material criteria the Commission will judge the effectiveness of this agreement.’ Yet, the MEPs recognised the limited impact they had upon the actual decision-making. When the treaty entered into force on 1 June, the EP Political Affairs Committee expressed its regret that the

Commission and the Council of Ministers had not taken into account its recommendations on the scope and content of the agreement. 87 But it scheduled another debate on the trade agreement, which further suggests the importance the European Parliament attached to the subject and the way it used the issue to position itself.88

With the ratification procedure for both parties completed on 2 May

1978, the EEC-PRC Trade Agreement entered into force on 1 June 1978.89 The signature ceremony had shown the politicised way in which the Chinese and the Community had conducted the trade talks. The Soviets reacted with new fervour in seeking official relations between the EC and COMECON. Within the Community, the European Parliament muscled its way further into the decision-making process via the Luns-Westerterp procedure, and it even bridged the gap to the EPC.

87 CMA, Intermediate Archive, 19649/1978, réunion de la Commission politique de l'Assemblée, Copenhague, 20/21 février 1978 (1), Brussels, 23 February 1978; AMAE, E-CE, CPE, 4199, Coopération politique européenne, réunion du groupe Asie (Copenague 11 et 12 mai 1978), Paris, 30 May 1978. 88 Debates of the European Parliament, Report by Mr. Müller-Hermann, on behalf of the Committee on External Economic Relations, on the trade agreement between the European Economic Community and the People's Republic of China, Official Journal C 239, 1978. 89 Official Journal L 123, 1978.

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Conclusion

The Cold War, and particularly the Sino-Soviet rivalry, is essential to explain why between February 1977 and April 1978 the Community and the Chinese so swiftly signed a trade agreement. The same factor also accounts for why the Commission and the Nine in the end overcame intra-Community conflicts so quickly. The overriding importance of the agreement was political. For the

Community this encompassed several dimensions: in respect of its external relations, the agreement constituted a precedent in the EC’s relations with the Communist countries. It represented the implementation of some fundamental aspects of the agenda it had pursued during the CSCE: conducting both commercial and human relations independently of the political and ideological nature of a system. The agreement also showed that the Community had managed to establish a closer relationship to the PRC than Washington had been able to up to that point not only diplomatically but also commercially.

In terms of intra-Community dynamics, the negotiations proved that

Haferkamp and DG I continued asserting the Commission’s leadership role which Soames had established on the China dossier. The episode is also one which demonstrates best the length to which the EP had gone in pushing its way into the EC decision-making regarding its foreign policy activity. Next to the parliamentary debates and question time, it associated itself to the negotiations via the Luns-Westerterp procedure. What is more, it discussed with the nine foreign ministers at the EPC. Again, the Cold War was instrumental for both the Commission and the EP to boost their role vis-à-vis

197 the member states. The question is whether the Cold War factor continued to play such a defining role now that the task was to implement the agreement.

198

Towards more substance (June 1978 – January 1980)

‘The question of follow-up raises the same question of balance and realism as emerged earlier. The long term possibilities are immense and it is politically important, given the success of our visit, that vigorous follow-up action is seen to be happening. On the other hand the Chinese side has made it clear - and our partners in the private sector here are now well aware of this - that the operation is going to be not a quick dash but a long haul and therefore it would be easy and counter-productive to overreach ourselves by trying to do too much too quickly.’1

Wilhelm Haferkamp, October 1978

‘La Communaut a pu mieux montrer qu'elle existe r ellement. […] Mais ce n'est qu'un premier pas.’2 Such was the Commission’s judgement regarding

Haferkamp’s follow-up mission on the EEC-PRC Trade Agreement when he visited China in autumn 1978. But it encapsulates more than that. It reveals the meaning the Commission gave to the EEC-PRC Trade Agreement: the agreement was a political statement – not just about the relationship between

Brussels and Beijing, but also about the way the Community sought to position itself in international affairs. And fundamentally it reflected how the

Commission claimed the role of a diplomatic actor speaking for the

Community. None of the works adopting transnational network approaches to write European integration history have picked up on Haferkamp’s visit – the first in the Community’s history to include representatives of the private

1 BAK, BKA, B 136/16619, Visit of European Community delegation to China September 24 - October 2, 1978, Haferkamp, Brussels, 9 October 1978. 2 ECHA, BAC 379/1991/86, Projet de conférence de presse à Bruxelles, author unknown, date unknown.

199 and public sector. Similarly, the historiography has also failed to acknowledge Jenkin’s visit to Beijing in February 1979 just as the Sino-

Vietnam war had broken out, and where the President of the Commission talked politics with the Chinese leaders.

The period between June 1978 and January 1980 is important because it reveals how the Community addressed the challenge of giving substance to a trade agreement that merely laid down a series of general principles. It shows that one of the purposes of the China missions by Haferkamp, the EP

President Emilio Colombo and Jenkins was to smooth political relations in order to facilitate the implementation of the agreement. It also indicates other ways in which the EC sought to demonstrate political good will towards the Chinese. The Community took concrete measures on issues that had been lingering even before the 1978 trade agreement: a further liberalisation of the

EC autonomous import regime, which also meant treating the PRC differently to the Soviet Union, and the inclusion of the PRC into its GSP. The period shows too, how the textile sector required a more concrete arrangement. The negotiations between the Chinese and the EC for a separate textile agreement proved difficult. And they brought to surface more intra-Community conflicts. The Cold War continued to be a defining external factor in shaping the relationship. However the economic competition with the United States and Japan became an increasingly important one also.

First, this chapter analyses the Community’s interpretation of rticle 6 of the EEC-PRC Trade Agreement, which aimed at facilitating contacts between individuals, groups and delegations from the economic, commercial and industrial spheres. It looks at the EC’s visiting diplomacy and the role the

200 private sector came to play in it. Second, it examines the way the Community interpreted Article 4, in which the Community committed itself to progressively liberalise its market for Chinese imports. Third, it investigates the negotiations for a textile agreement that operated within the framework of the Multi-Fibre Arrangement (MFA), which derived from the EEC-PRC

Trade Agreement and supplemented it at a sectoral level.

Practising diplomacy: the Commission’s and the EP’s visits to

Beijing

One highly visible way to implement the trade agreement was to follow-up on

Article 6 and engage in visiting diplomacy. The time was a peculiar one in

China’s history, and the Europeans were highly aware of it. The PRC gave priority to achieving an ambitious economic development programme. China therefore encouraged foreign investment and international confidence.

Although inflexible government plans controlled the industry, China signalled with some key achievements the modernisation plans for its economy. It drastically developed its domestic and international airline systems, completed an immense dry-dock facility at the Hebei port of

Shanhaiguan, and built and launched its first oil tanker in the 50,000-ton class.3 But the most important change in Chinese Communist policy since the outbreak of the Cultural Revolution was the policy of Four Modernisations, laid out at the Third Plenum of the Eleventh Central Committee of the CCP in

December 1978.4 It involved developing industry, agriculture, science and

3 Spence, The Search for Modern China, pp.618–619. 4 Spence, The Search for Modern China, p.621.

201 technology, and national defence. It marked the beginning of the reform era led by Deng Xiaoping. Both the Commission and the European Parliament viewed the visiting diplomacy as an opportune way to continue enhancing their role not only vis-à-vis the Chinese government, but also in relation to the member states, the business community, and particularly in the light of impending direct elections to the European Parliament, the public at large.

Haferkamp’s visit, which lasted from 24 September to 2 October 1978, was a symbolic one to prove to the Chinese government the Community’s commitment to the trade agreement. The idea was ‘that Willi Haferkamp should first play John the Baptist and make a preparatory visit’ for the one by

Jenkins.5 Subjects to be discussed by the Commission vice-president while in

China included how the future joint committee, which Article 9 had called for, should operate, and what other areas of cooperation existed apart from trade, such as energy, and science and technology. 6 The visit exceeded

Haferkamp’s expectations in terms of the number and rank of Chinese political leaders that he met. 7 He sat down with the Minister for Foreign

Trade Li Jiang, the Deputy Foreign Minister Zhang Wenqin, and the Deputy

Prime Minister Li Xienian. Even Chairman Hua received and discussed with him for a full hour and a half. The atmosphere throughout was positive and friendly, and was not purely ‘protocolaire’.8 These contacts were an emphatic demonstration of the political importance the Chinese government attached to the relationship with the Community.

5 Private papers shown by N. Piers Ludlow, Visit to China, Tickell, April 1979. 6 ECHA, BAC379/1991/86, Mission en Chine, Kawan, Brussels, 20 September 1978. 7 BAK, BKA, B136/16619, Visit of European Community delegation to China September 24 - October 2, 1978, Haferkamp, Brussels, 9 October 1978. 8 Ibid.; ECHA, BAC 379/1991/86, Denman to Tickell, 29 September 1978.

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In order to impress the Chinese and bolster the significance of his visit,

Haferkamp included representatives from the private and public sector in his delegation. Members of the delegation included representatives of the

Economic and Social Committee, the Union of Industries of the European

Community, the European Trade Union Confederation, the European

Banking Federation, and prominent industrialists and businessmen from all nine member states. The most important were Roger Martin, Chairman of

France’s Saint Gobin Pont-à-Mousson, Dirk de Bruyne, President of Royal

Dutch Shell, Sir Peter Fennan, Chairman of the London Chamber of

Commerce, and Helmut Hausegen, President of the European Confederation of Banks.9 The Commission therefore signalled to the Chinese the European intention to make concrete use of the economic opportunities opened up by the trade accord.10

At the same time, Haferkamp used his visit to demonstrate to the

European private sector the virtues of trade with China, and the relevance of the EC in facilitating business contacts. This was one of Haferkamp’s continuous endeavours. 11 Speaking at the Foreign Affairs Club in London later in April 1979 for example, the Commissioner used his visit to China to show-case to the British the advantages of EC membership, and the importance that other countries attached to the Community. 12 One of the messages Haferkamp consistently sent out to European business people, the

9 ECHA, BAC 379/1991/86, Adressenliste der Teilnehmer China-Reise, undated. 10 ECHA, BAC 379/1991/86, Le thème politique de base (sous forme d'allocation), Kawan, Brussels, 15 Septembre 1978. 11 ECHA, BAC 379/1991/86, Meeting with Chinese mission on 2nd June, Maslen, Brussels, 5 June 1978. 12 ECHA, Speech collection, Haferkamp, "Some aspects of Community trade policy", Foreign Affairs Club, London, 5 April 1979.

203 banking sector, the agricultural trade unions and even political foundations, was the necessity to open the EC market to Chinese products. The competition from Japan and the United States were the main arguments he used to convince.13 Haferkamp also urged industries to organise more on a

European level to face this competition.14

It is this competition that prompted Haferkamp to schedule his visit to the PRC in September 1978. Japan and China had signed the Sino-Japanese

Treaty of Peace and Friendship in August 1978. And they were also making preparations to sign an agreement that promised to give the Japanese a 30% share in Chinese external trade.15 Before that the Chinese government had already negotiated a new US $ 10 billion industrial agreement with Japan, and it also agreed on a joint Sino-Japanese exploration of oil in the North

China Sea.16 Haferkamp sought to signal with his delegation that that the

Community was in the game too, competing for a share of the Chinese market.

Similar to his predecessor, Haferkamp used the tactic of fait accompli in order to assure the Commission’s room for manoeuvre vis-à-vis the member states, but also to realise personal interests. He made clear that it was up to the Commission to decide on whom he included on his China mission. In fact, the selection rested upon Haferkamp’s personal decision. COREPER

13 ECHA, Speech collection, Haferkamp, Bank für Gemeinwirtschaft, Frankfurt, 22 March 1979; ECHA, Speech collection, Haferkamp, Verbindungsstelle Landwirtschaft und Industrie, Essen, 1 February 1979; ECHA, Speech collection, Haferkamp, Chancen des Ausbaus der Wirtschaftsbeziehungen der EG in Asien: Japan, China, ASEAN, Friedrich-Ebert-Stiftung, Bonn, 8 November 1979. 14 ECHA, Speech collection, Haferkamp, Verbindungsstelle Landwirtschaft und Industrie, Essen, 1 February 1979. 15 ECHA, BAC379/1991/86, Mission en Chine, Kawan, Brussels, 20 September 1978. 16 Spence, The Search for Modern China, p.618.

204 protested about this, but to little effect. Haferkamp simply brushed aside the criticism and went ahead. 17 Once his mission concluded, he wrote to the ambassadors of the member states:

‘the mission as it was represented a gamble. We had never included businessmen on this scale in a Community mission before. We were not certain of getting the right people or making the right contacts when we got to China. But on both counts the mission worked; not only was there a strong Chinese willingness to develop their relations with us. But we went with the right people and at the right time. Thus we showed our colleagues in the private sector in particular - and I hope member governments - that the Commission can perform a valuable role in circumstances such as this.’18

Similar too, was Haferkamp’s analysis regarding the Chinese, as is reflected in the opening quote of this chapter. ll in all, Haferkamp’s visit reveals the

Commission’s successful use of transnational networks to carry out its ambitions regarding the field of foreign policy.19

What had profoundly changed compared to Soames’ time in office was the role of the European Parliament. The President of the European

Parliament had also featured on Haferkamp’s list of people to invite onto his delegation. This shows how the Commissioner took account of the changing realities in intra-Community politics. Colombo’s reply also reflects this change and the EP’s new confidence. He politely thanked Haferkamp, but

17 ECHA, BAC379/1991/86, Déjeuner de travail du COREPER, 22 juin 1978, Prochain voyage officiel de M. Haferkamp en Chine, Noel to Beck, Brussels, 22 June 1978. 18 BAK, BKA, B136/16619, Visit of European Community delegation to China September 24 - October 2, 1978, Haferkamp, Brussels, 9 October 1978. 19 On the role of transnational networks see for example: Morten Rasmussen, 'European Rescue of the Nation- State? Tracing the Role of Economics and Business', in Wolfram Kaiser and Antonio Varsori (eds.), European History: Themes and Debates, (Basingstoke: Palgrave Macmillan, 2010); Wolfram Kaiser, Brigitte Leucht and Michael Gehler (eds.), Transnational Networks in Regional Integration: Governing Europe, 1945-83, (Basingstoke: Palgrave Macmillan, 2010); Leucht Brigitte, 'Transatlantic Policy Networks and the Formation of Core Europe', University of Portsmouth, 2008.

205 made the point that the European Parliament intended to follow up its own contacts made with the PRC rather than participating as the Commission’s guest.20 Having refused to accompany Haferkamp, the EP again asserted its role in relation to the Commission by scheduling Colombo’s visit to Beijing just before Jenkins was due to travel there. Colombo visited the PRC from 3 to 8 January 1979 upon the invitation of the Chinese National Popular

Assembly. He was invited because the Chinese government regarded the EP as crucial in the European integration process it supported against the Soviet

Union. Colombo’s high-level meetings with Zhi Pengfei, Deng Xiaoping and

Hua Guofeng demonstrated the rising role of the European Parliament in the

EC-PRC relationship, which neither the member states nor the Commission could afford to ignore any longer.21

Jenkin’s visit, the first of a Commission President to China, meant that the Commission could prove itself at a moment of international crisis. Three days before his visit, scheduled for 21 February to 1 March 1979, the Chinese launched a border offensive against ietnam in response to ietnam’s invasion of Cambodia. All nine EC foreign ministers called in the respective

Chinese ambassadors and asked China to end the incursions into Vietnam.22

Jenkins, who already had visited China as Labour MP in 1973, noted in his diary on 17 February: ‘I learnt that war had broken out between China and

Vietnam, which was a highly inconvenient time and raised a question of

20 CARDOC, PE1 P1 223/RICM RICM/1977/617, Colombo to Haferkamp, Luxembourg, 17 July 1978. 21 AMAE, AO, prov. 2159, visite en Chine du Président de l'Assemblée Parlementaire Européenne, Arnaud to Francois-Poncet, Beijing, 10 January 1979. 22 Louven, 'The European Community and Asia'.

206 whether we should still go to Peking on Tuesday.’23 In the end, he decided to go ahead. The discussions Jenkins had with Hua Guofeng, Deng Xiaoping, Gu

Mu, Foreign Minister Huang Hua and Li Jiang, were characterised by political and geopolitical issues, as much if not more than economic ones. 24

Therefore his visit further strengthened Commission’s role in international diplomacy.

Unsurprisingly, the Soviets condemned the Commission’s diplomacy forcefully. Regarding Haferkamp’s visit an article in T SS, the leading Soviet news agency, directed its polemic mainly at the PRC and Western pro-PRC circles. What most surprised the German diplomat evaluating the press was that the article asserted that the Nine agreed to arms sales with the PRC, that anti-Soviet circles gained more and more influence in the Community, and that Haferkamp’s visit was linked to enhancing cooperation in the area of military and defence. This was to be seen in relation to Beijing’s long-term objective of using a rapprochement with the Common Market to establish a closer relationship with the NATO-bloc.25 The French picked up on the same

T SS article and also highlighted the connection made between Haferkamp’s

23 Jenkins, European Diary, p.401. 24 AMAE, Série DE-CE, NC, 1369, Visite de M. Jenkins, Relations Chine-CEE, Arnaud to Adresse Diplomatie Paris, Beijing, 28 February 1979; ECHA, BAC 379/1991/77, Conversation between the President of the European Commission and Vice-President Deng Xiaoping: Great Hall of the People, Beijing, 23 February 1979, Tickell, 5 March 1979; ECHA, BAC 379/1991/77, Record of conversation between the President of the European Commission and Chairman Hua Guofeng: Great Hall of the People, Beijing, 24 February 1979, Tickell, 6 March 1979; ECHA, BAC 379/1991/77, Record of conversation between the President of the European Commission and the Minister of FOreign Trade of China, Beijing, 23 February 1979, Reuter, 5 March 1979; ECHA, BAC 379/1991/77, Record of conversation between the President of the European Commission and Vice-Premier Gu Mu: Great Hall of the People, Beijing, 22 February 1979, Crispin Tickell, 8 March 1979. 25 PAAA, B37, Zwischenarchiv 107519, Besuch von Kommissionsvizepräsident Haferkamp in China, hier: Sowjetische Kritik an westlicher Chinapolitik, Wieck to Bonn AA, Moscow, 7 October 1978.

207 visit and NATO. 26 The Commission’s activity spurred the Soviet fear of encirclement.

The reaction to and effect of Jenkins’ visit was similar. De Leusse reported that the Soviets found Jenkins’ visit inadmissible particularly at a time when China had attacked Vietnam militarily. 27 Even more virulent criticism came from Albania: ‘Pour atteindre leurs objectifs de superpuissance les "social-impérialistes chinois", qui en avril 1978 avaient signé un accord commercial avec la CEE, n'hésitent pas, outre les liens établis avec l'impérialisme américain et les militaristes japonais "rechercher toute la collaboration possible" avec les milieux les plus réactionnaires et bellicistes de l'Europe occidentale dans le cadre de l'OT N et du march commun.’ 28 In

Brussels, Mr. Kouznetsov, counsellor at the Soviet embassy, called upon

Tickell on 15 February 1979.29 He asked about the purpose of Jenkins’ visit to the PRC, and wanted to know precisely what the Commission intended to offer the Chinese in any trade negotiations. He expressed his concern about member states, such as Britain, selling arms to the PRC. Moreover he asked if the Nine would take any position on the crisis between China and Vietnam. A few days later, Mr. Babenkov, the secretary at the Soviet embassy in Brussels, and Stehno, also called upon the Commission to assert that Jenkins’ visit assumed a regrettable significance in the light of the Chinese intervention in the military conflict between Cambodia and Vietnam. Babenkov even raised

26 AMAE, Série DE-CE, NC, 1369, Visite à Pékin d'une délégation de la CEE, Dupont to Adresse Diplomatie Paris, Moscow, 4 October 1978. 27 AMAE, AO, prov. 2130, Visite en Chine de M. Roy Jenkins, Leusse to Adresse Diplomatie Paris, Moscow, 21 February 1979. 28 CAC, SGCI files, Versement 19930085, Article 30, Une délégation de la CEE à Pékin, Lecompte to Adresse Diplomatie Paris, Tirana, 24 February 1979. 29 HAEU, EN 1149, Call of counsellor from Soviet embassy, Brussels, Tickell to Jenkins, Brussels, 15 February 1979.

208 the question of whether Jenkin’s decision to go was not a choice directed against the Soviet Union.30 The reaction from the Soviet bloc shows that the

Commission at all times had to expect and manage an antagonistic reception to its expanding foreign policy activity with China.

In less than a year following the signature of the EEC-PRC Trade

Agreement, the two EC institutions that had proven most active and committed to forging the links with the Chinese government had staged three key diplomatic visits to Beijing. Thereby the Commission and the European

Parliament continued to explore ways to bolster their own position in intra-

Community politics. The pattern of visits also reflected the European

Parliament’s further emancipation in light of its direct elections. They also showed how the Commission acted as a broker for business contacts between the Europeans and the Chinese. It demonstrated a critical presence at the height of the Sino-Vietnamese war. With the enthusiastic Chinese response, the objectives of the missions had been met, and a positive European reception ensured that the Commission gained further credentials as EC spokesperson in diplomacy. And via the banking and private sector, it had found a new instrument for its foreign policy activity.

The EC’s unilateral trade liberalisation

The volume of trade between the PRC and the Community was in fact very small. The Europeans were well aware of this. Kawan noted:

30 HAEU, EN 1149, Call of counsellor from Soviet embassy, Brussels, Tickell to Jenkins, Brussels, 15 February 1979.

209

‘Les importations en provenance de Chine vers la Communaut étaient, en 1977, de EAU 855 millions [approx. US $ 1118 million]. A titre de comparaison, notons que celles de la

Pologne étaient de EAU 2,122 milliards [approx. US $ 2775 million]

Hongrie 1 milliards [approx. US $ 1308 million]

Suède 8 milliards [approx. US $ 10462 million]

Suisse 7 milliards [approx. US $ 9154 million]

URSS 6 milliards [approx. US $ 7846 million]

Inde 1,6 milliards [approx. US $ 2092 million]

Nos ventes à la Chine étaient, en 1977, de EAU 794 millions [approx. US $ 1038. ] Celles vers la

Pologne s'élevaient à 2,5 milliards [approx. US $ 3269 million]

URSS 5,8 milliards [approx. US $ 7585 million]

Suisse 12 milliards [approx. US $ 15692 million]

Inde 1, milliards’31 [approx. US $1831 million ]

31 ECHA, BAC 379/1991/86, Mission en Chine, Kawan, Brussels, 20 September 1978.

210

The IMF data support this view:

Table 0-1: Direction of trade of the Nine for 1976 to 1979 in million US $32

Exports of the Nine 1976 1977 1978 1979 to

the PRC 1314 907 1908 2879

Hungary 1194 1529 1971 2028

Sweden 9613 10115 10489 13297

the United States 18246 22903 28631 34325

Imports by the 1976 1977 1978 1979 Nine from

the PRC 949 999 1226 1861

Hungary 943 1148 1305 1730

Sweden 8730 9436 11366 14292

United States 27623 29190 35310 46565

Kawan also commented that in the short term the Community was not expecting a massive increase in trade. Nonetheless, two external factors proved strong incentives for the Community to follow-through Article 6 of the

EEC-PRC Trade Agreement, and satisfy the Chinese demands to open up the

EC markets: the oil shocks and the increasing competition from Japan and the United States in the Chinese market.

The second oil shock meant that the Community kept a close eye on the

PRC’s oil exports. In April 1979 the Auswärtiges Amt remarked regarding the

32 International Monetary Fund (2006): Direction of Trade Statistics (Edition: 1948-1980). ESDS International, University of Manchester.

211 advantages of a more active EC economic policy towards the East that ‘Die

Energie- und Rohstoffprobleme Westeuropas werden es längerfristig sinnvoll erscheinen lassen, die enormen Reserven einiger RGW-Länder und der VR

China in ein kooperatives Konzept einzubeziehen.’ 33 For example, Claude

Mont, from the Christian Democratic Group, pointed out that ‘the Europe of the Nine is very keen on getting Chinese oil.’34 At the same time, international competition in the Chinese market grew. The commercial counsellors emphasised in their report of 30 June 1979 the EC had to open itself up to

Chinese products. They also argued that the Community had to use a lot of imagination and determination if it wanted to face up to the increasing competition from Japan and the United States.35

The first measure the Community took was to introduce a new regulation that widened the range of products that the PRC could export to the EC without restriction. The new list allowed China to export about 20 more products to the Community. On 19 September 1978 the Council of

Ministers agreed to this new regulation. 36 Up to that point, restrictive regulations applicable to all state trading countries which the Nine had adopted on 19 December 1969 governed trade with the PRC. In effect the new regulation was a diplomatic tool by which the Community signalled that it

33 Debates of the European Parliament, Report by Mr. Müller-Hermann, on behalf of the Committee on External Economic Relations, on the trade agreement between the European Economic Community and the People's Republic of China, Official Journal C 239, 1978. 34 Ibid.; see also: ECHA, Speech collection, Les problèmes économiques extérieurs de la CEE, 30 May 1979. 35 PAAA, B21/200, Zwischenarchiv 110507, Rapport commun des conseillers commerciaux des pays membres de la CEE en Chine, Beijing, 30 June 1979. 36 Règlement (CEE) n° 2532/78 du Conseil, du 16 octobre 1978, relatif au régime commun applicable aux importations en provenance de la République populaire de Chine; AMAE, AO, prov. 2130, La République populaire de Chine et la Communauté europénne, Europe Information, Commission des Communautés européennes, Groupe du Porte Parole et Direction Général de l'Information, 17/79.

212 considered the PRC in a different category to the other state trading countries, above all differently to the Soviet Union.

Several reasons explain the Community’s decision. First, Beijing had long pressed to be treated differently than the Soviet bloc. 37 The Chinese based their request on the fact that the other state trading countries had not engaged with the EC offer of 1974 to conclude a Community trade agreement.

Second, the specific timing was important. Haferkamp’s visit to the PRC was imminent, and adopting this new regulation was intended to contribute to the diplomatic success of his mission. 38 Third, the Japanese had just announced a 20 billion US$ credit offer to the PRC. To remain in a competitive position, the Community needed to offer the Chinese something concrete too. 39 Finally, the Commission viewed the new regulation as a possible bargaining chip in any future negotiations with the Eastern

European countries and the Soviets.

Whereas the Commission and the majority of the Nine supported the special regulation, only Germany was initially against it. 40 For political reasons the Auswärtiges Amt supported the regulation. But the

Bundesministerium für Wirtschaft did not, because it did not want to complicate the EC trade regime by establishing different procedures for

37 BAK, BKA, B136/34643, EG-VR China, Zeller to Staatsminister, Bonn, 13 July 1978; BAK, BKA, B136/34643, Handelspolitik EG-VR China, hier: Anwendung der Verordnung 109, Bonn, 28 June 1978. 38 BAK, BKA, B136/34643, 910. Tagung des Astv, Teil 1, am 06.09.1978, Änderung der von 1439'74 und 109'70, insbesondere Frage der VO 109 China (Verfahren), Kittel to Bonn AA, 6 September 1978. 39 Ibid. 40 Ibid.

213 different economic partners.41 Eventually the Germans lifted their objections in the face of complete isolation.42 In addition, they felt under pressure to join the majority given the nationality of Haferkamp. Germany did not want to appear to be taking advantage of one of their countrymen being the

Commission vice-president, or spoil his success.43

Next to the new EC regulation, the second measure the Community took to open its market to China was to include the PRC in the Community’s

GSP.44 The measure was significant because the Community granted this preferential treatment in principle only to the developing countries that were part of the G-77, the organisation of developing countries created during the first session of UNCTAD.45 The GSP had been an important instrument in the

Community’s development policy since 1 July 1971. Cuba, Vietnam and

Romania were the only state trading countries the EC had included in the

GSP hitherto.46 Therefore the inclusion meant a qualitative shift in the way the Community treated China. Even if the inclusion did not mean that the

Community recognised the PRC as a developing country it once more signalled that the EC treated the PRC differently from the Soviet Union.

41 BAK, BKA B136, 34643, Handelspolitik EG-VR China, hier: Anwendung der Verordnung 109, 411-423-CHN, Bonn, 28. June 1978, BAK, BKA B136, 34643, Liberalisierungsaktion der Gemeisnchaft gegenüber China, hier: Stand der Erörterung in Brüssel, Steeg (Die Leiterin der Abteilung V) to Staatssekretär Dr. Rohwedder, Bonn, 27. June 1978. 42 Ibid. 43 BAK, BKA B136, 34643, telegram, 911. Tagung des Astv, teil 1 vom 13.09.1978, top: op: Änderung der voen 1439'74 und 109'70, insbesondere Frage der VO 109 a' China (dok. s 1375'78 (comer 149), Bericht der Gruppe Handelsfraken (dok i-715-78), Bruessel Euro i.v. Kittel, to Bonn AA, 13 September 1978. 44 European Commission, Bulletin of the European Communities, point 2.2.19, 7/8, 1979. 45 PAAA, B21/200, Zwischenarchiv 110507, Stellungnahme der Gemeinschaft anlässlich der ersten Situung des Gemischten Ausschusses EWG-China bezüglich der Einbeziehung Chinas in das Allgemeine Präferenzsystem, Commission to the Council of Ministers, Brussels, 26 March 1979. 46 PAAA, B201/411/486, Behandlung Bulgariens durch die EG, Lautenschlager to Dohnayi, Bonn, 6 July 1979.

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The EEC-PRC Trade greement was a catalyst for the Community’s decision. Including the PRC into the GSP meant the EC responded to a long- standing Chinese request. Already in 1975, Beijing used London as a sounding board on the matter. At that time the FCO did not think that a positive response would pose any political difficulties.47 But the FCO proved wrong because including the PRC into the GSP could be a precedent for other state trading countries asking to be granted similarly advantageous EC treatment. Since then the question had periodically resurfaced when the Nine dealt bilaterally with the PRC. 48 With the EEC-PRC Trade Agreement concluded, the PRC government argued that it had not cost the Community much to grant the MFN status, but the trade accord had meant a substantial loss in customs revenues for the PRC. Therefore, in return, the EC ought to include China in its GSP. 49 During Jenkins’ visit in February 1979, the

Chinese once more made clear that they expected the Community to answer their request.50

Therefore the Commission proposed to the Council of Ministers in

March 1979 to include China in its GSP. It backed up its proposal with a detailed economic analysis of the effects of such an inclusion. It concluded that an examination of the most important economic factors had shown that

47 NA, FCO 21/1391, China and the GSP, Roberts to Ingram. 48 PAAA, B37, Zwischenarchiv 107519, Beziehung EG-VR China - Einbeziehung Chinas in das Präferenzsystem der EG sowie Zeitpunkt der Sitzung der Gemischten Kommision EG-China, Gerhardt to Bonn AA, Bonn, 4 October 1978. 49 PAAA, B21/200, Zwischenarchiv 110507, Beziehungen der EG zu China, Wickert to Bonn AA, Beijing, 2 April 1979. 50 PAAA, B21/200, Zwischenarchiv 110507, Einbeziehung Chinas in das Allgemeine Präferenzsystem der EG, Randermann to Staatssekretär, Bonn, 26 June 1979.

215 the EC had to regard the PRC as a developing country.51 It emphasised in particular that the GDP per capita in China in 1976 amounted to 410 US$, which put the PRC on the same level as other developing countries such as

Honduras or Zambia. In addition, despite recent efforts to industrialise, the economy was still based on agricultural production, and 68% of the working population were employed in the agricultural sector. The energy consumption stood in 1975 at 693kg per person, which was similar to countries such as Peru and Iraq. Moreover, since 1958 the balance of trade with the Community had been in deficit, with the exception of 1977. In the first eleven months of 1978, the deficit amounted to 471 Million RE, which represented 56% of the Chinese exports to the Community. And the

Commission did not expect any change in the deficit situation in the near future.

s to the effects of the PRC’s inclusion in the GSP scheme, the

Commission did not think that the type of agricultural produce the Chinese exported to the Community would cause any problem if included in the GSP.

What was more difficult was the fact that the Chinese would be able to export sensitive industrial products to the EC such as leather, shoes and textiles, and these were precisely the industries in crisis in Europe. But the Commission also pointed out that amongst the developed countries, and fiercest competitors with the EC on the Chinese market, Australia had granted China

51 PAAA, B21/200, Zwischenarchiv 110507, Stellungnahme der Gemeinschaft anlässlich der ersten Situung des Gemischten Ausschusses EWG-China bezüglich der Einbeziehung Chinas in das Allgemeine Präferenzsystem, Commission to the Council of Ministers, Brussels, 26 March 1979.

216

GSP without the PRC having to apply for it, and Japan was also examining the question in a positive light.52

In the discussions on whether or not to include the PRC, it was

Bulgaria’s 1977 application to the GSP that caused the main problem for the

Nine. The Community had refused Bulgaria’s application.53 The Commission argued that because of the Chinese level of poverty and the establishment of official relations, the PRC was a more deserving country than Bulgaria.54 The

British thought that unlike China, Bulgaria was not the type of country intended for the GSP.55 They supported the inclusion, based on the view that it was politically almost impossible to refuse it to the Chinese. They attached the greatest weight to the psychological effect, but pointed out that it was unlikely to cause serious damage to their national industry.56

Germany had supported Bulgaria’s inclusion although the country did not have any official relations with the EEC and had a higher GDP than

China. But like the British, the Germans agreed to the PRC’s inclusion for political reasons. 57 Bonn also argued that the recent increase in German exports to the PRC meant that it was in its interest to establish the conditions

52 Ibid. 53 PAAA, B21/200, Zwischenarchiv 110507, Einbeziehung Chinas in das Allgemeine Präferenzsystem der EG, Randermann to Staatssekretär, Bonn, 26 June 1979. 54 NA, FV 58/297, Article 113 (China Committee): 30 March 1979: EEC/China Joint Committee, UK Rep to FCO, 30 March 1979. 55 NA, FV 58/297, China: admission to the Generalised Scheme of Preferences, McINnes, 12 April 1979. 56 Ibid. 57 PAAA, B37, Zwischenarchiv 107519, Beziehung EG-VR China - Einbeziehung Chinas in das Präferenzsystem der EG sowie Zeitpunkt der Sitzung der Gemischten Kommision EG-China, Gerhardt to Bonn AA, Bonn, 4 October 1978.

217 for an increase in Chinese imports to Germany.58 Whereas initially it had insisted that the PRC put in an application and explicitly state in its application that it was a developing country, it eventually accepted that the

EC granted the PRC inclusion without the PRC having formally applied for it. 59 Just in time for the first joint committee meeting in July 1979, the member states agreed to include the PRC into the Community’s GSP.60 This meant that from 1 January 1980 onwards the PRC benefitted from preferential treatment for all products covered except for agricultural products subject to quotas and sensitive industrial products such as textiles.61

Politics rather than economics had decided the matter.

The EEC-PRC Trade Agreement spurred the Community to respond to a long-standing political request by the PRC: namely that the Community treat

China differently to the Soviet bloc. The EC responded in two ways. First it adopted a new regulation which increased the number of products the PRC could export to the EC without restrictions. Second, it included the PRC into its GSP. In both instances the timing of the decision reveals the essentially political motives of the Community. The Council adopted the new regulation just before Haferkamp’s mission to China in September 1978. nd the Nine agreed on the GSP just before the first joint committee meeting took place in

58 PAAA, B37, Zwischenarchiv 107519, Beziehungen EG-VR China, hier: Einbeziehung Chinas in Präferenzsystem der EG sowie Zeitpunkt der Sitzung der Gemischten Kommisson EG-China, Sieger to AA Referat 411, Bonn, 9 October 1978. 59 PAAA, B37, Zwischenarchiv 107519, Beziehung EG-VR China - Einbeziehung Chinas in das Präferenzsystem der EG sowie Zeitpunkt der Sitzung der Gemischten Kommision EG-China, Gerhardt to Bonn AA, Bonn, 4 October 1978. 60 CMA, Historical Archive, CM2, CEE CEA 25, Dossier concernant la 949ème réunion du Comité des représentants permanents, Bruxelles, du 26 au 29.06.1979. 61 European Commission, Bulletin of the European Communities, point 2.2.19, 7/8, 1979.

218

Beijing in July 1979. Therefore the Community’s perceived need to smooth the political relations with the PRC drove economic change.

A delicate task: negotiating the textile agreement

On 5 December 1978, the PRC asked to open negotiations with the

Community for an agreement on trade in textile products.62 For China a wider access to the EC market was important because textiles were one of its main export articles to Europe. In 1977 textiles accounted for a third of China's exports to the Community (260 million European units of account, i.e. approximately $US 340 million).63 The textile trade was a crucial means to finance the import of other more technologically advanced goods to China that were necessary to fulfil the Four Modernisation Programme. 64

Problematically, the European textile and clothing industry had fallen into a deep crisis in the 1970s. Changing consumer behaviour, technological standardisation, a lack of innovation and increasing competition from lower- labour cost countries all contributed to the critical situation for the sector.

Textiles were amongst the most stagnant industrial sectors, next to aeronautics and defence-related high technology, for which the Community had defined goals for an emergency reconstruction.65 The challenge posed to the EC negotiators were multi-level and related to Beijing, the member states’

62 European Commission, Eighth General Report on the Activities of the European Communities in 1974, (Brussels: EEC, 1975), p.253. 63 Commission of the European Communities, Europe Information, 17/79, Brussels, 1979. 64 BAK, BKA, B136/34643, Verhandlungen zwischen der EG und der Volksrepublik China über ein Textilhandelsabkommen, Schwinne to Chef des Bundeskanzleramtes, undated. 65 Middlemas, Orchestrating Europe, 1973-95, p.96.

219 governments who sought to protect their national industries, and other EC suppliers such as Turkey, Greece, India and Pakistan.66

A year and a half later, on 18 July 1979, the Commission and the

Chinese managed to initial a textile agreement which replaced the

Community’s unilateral regime. The agreement provided a five-year framework for imports into the Community of Chinese textiles. Whereas the member states on average had restricted 60 out of the 114 categories autonomously (Germany 41, France 55, Benelux 61, Britain 81), now an autonomous self-restriction was foreseen in only 16 categories.67 A further 9 categories of products which were particularly sensitive in different member states remained subject to regional limitations. 68 For the rest of the categories the agreement set out a procedure that would ensure that the Chinese exports to the EC did not surpass a certain limit.

In exchange for the substantial additional access provided for Chinese textiles to the EC market, the Chinese negotiators agreed to reinforce the safeguard clause for products not subject to limitation. This was to ensure that the Community was able where necessary to keep Chinese exports of textile and garments to the EC at levels not exceeding certain thresholds, which were equal to the highest levels granted to the EC suppliers under the

MFA. This offered essential protection for the Community industries, and also provided security of access to the EC market for Chinese exporters. The

66 Louven, 'The European Community and Asia', pp.1233–1234. 67 PAAA, B201/411/434, Textilhandelsregelung EG/China, Leyser and Mohrmann to Außenminister, Bonn, 27 July 1979. 68 NA, FV 59/298, Text of press guidance on textiles agreement with China, Peking to UK Rep Brussels, Beijing, 18 July 1979.

220

Chinese authorities also committed to provide for guaranteed minimum supplies of certain textile raw materials needed by Community processors

(namely raw silk, angora and cashmere). 69 Both parties viewed the final outcome as true progress in their economic policies. It represented a major step in the liberalisation of the textile trade between the EC and the PRC.

Even so, the Chinese expectations, judged by the German representative as excessively high, had not been met. Bonn thought that the concerns of the

German industry had been safeguarded.70 London’s reaction was one of relief but limited enthusiasm.71

The negotiations were difficult. The Chinese demands imposed a severe test on the integrity of the Community's textile policy. The Community faced a dilemma, as the Foreign Ministers summed up at their meeting on 2 and 3

April 1979. 72 On the one hand if the Community did not offer China access beyond the existing Community and regional global ceilings, the negotiations would break down without agreement. The Chinese would regard this as a significant political rebuff, which would affect the development of the

Community's overall trade with China. But the Community had already broken the global ceilings once, in 1978, in order to accommodate the

Mediterranean suppliers. Additional breaches for China would further weaken the credibility of the Community's textile policy in the eyes of

European industry. Thus the conflict was that on the one hand the EC had the responsibility to protect the Community’s textile industry and the agreements

69 Ibid. 70 PAAA, B201/411/434, Textilhandelsregelung EG/China, Leyser and Mohrmann to Außenminister, Bonn, 27 July 1979. 71 NA, FV58/298, EEC/China: Foreign Affairs Council 24 July, Crompton to Willis, 20 July 1979. 72 NA, FV 58/297, Council of Ministers (Foreign Affairs) Luxembourg 2/3 April 1979, 30 March 1979.

221 with other external suppliers. On the other hand it did not want to jeopardise any trade opportunities with the PRC.

Indeed the EC negotiators had to take into account the interests of other suppliers to the EC who had concluded agreements with the Community under the MFA since 1977. 73 Community and member state officials, like

British Secretary of State for Trade John Smith, were concerned that a textile agreement would curb the EC export opportunities available to developing countries, especially India and Pakistan. The Community was able to persuade the developing countries to negotiate multilateral agreements, limiting the growth of their textile exports, only by promising them that they would enjoy a guaranteed share of European markets under the arrangements. If these supplier countries were to lose out to Chinese competition, Community officials feared that the Community’s relations with the developing world would be severely damaged.74

The other challenge was to deal with protests from the European trade unions and textile companies. In Germany, Berthold Keller, Hauptvorstand

Gewerkschaft Textil-Bekleidung, for example wrote to Chancellor Schmidt to urge him to personally protect the industry. Whereas the French and British governments were protecting their industries, Keller criticized that ‘die

Bundesrepublik offensichtlich wieder superliberal glänzt.‘ 75 Other textile businesses also protested. They mainly used the argument that an agreement

73 NA, FV59/298, Text of press guidance on textiles agreement with China, Peking to UK Rep Brussels, Beijing, 18 July 1979. 74 NA, FV58/297, China seeking to treble sales of textiles to EEC, Guy de Jonquieres, 15 March 1979; NA, FV58/297, from the Minister of overseas development, Smith, London, 2 April 1979. 75 BAK, BKA, B136/34643, Textilabkommen mit der VR China, Keller to Schmidt, Düsseldorf, 19 March 1979.

222 with China threatened employment. 76 The French industry reacted vehemently too, as illustrated in letters by the Président du Syndicat Général de l’Industrie Cotonnière Française, Roger Sauvegrain, and L. C. Bary, the vice-president Déléguée Union des industries textiles. 77 In Britain, such protests were seen for example in the actions of the Derby Group and the

British Clothing Industry’s Council for Europe Limited.78 Additionally, the lobbying activity organised itself at a European level, as illustrated by the

General Assembly of the Coordination Committee for the Textile Industries in the European Economic Community (Comitextil).79 The textile industry’s outcry against an EEC-PRC Textile Agreement proved fierce, and neither the member states nor the Commission could afford to disregard them.

The protests also reveal how the Commission did not leave it to the national governments to handle matters. The Commission engaged directly with the industry to address their concerns. For instance, when the French government blocked the negotiations in July 1979 because it refused the

Chinese demands, Tran van Tinh, the Commission’s special representative for textile negotiations, addressed a telegram directly to the Syndicat Général des industries cotonnières in Paris. He urged the French trade union to back a compromise: ‘En tant qu'ami, je pense que le mieux est ennemi du bien et qu'il faut se battre pour des réalités tangibles et non pour se protéger des

76 BAK, BKA, B136/34643, Geplantes Textilabkommen zwischen der EG und VR-China, Firma Bleimund Gmbh + Co Kg to Schmidt, 27 March 1979. 77 CAC, SGCI files, Versement 19910040, Article 23, Sauvegrain to Giraud, Paris, 18 July 1979; CAC, SGCI files, Versement 19910040, Article 23, Bary to Giraud, 23 July 1979. 78 NA, FV59/298, Meeting of the Derby Group on July 11 in Ashdown House, British Clothing Industry's Council for Europe Limited, 10 August 1979. 79 ECHA, Speech Collection, to the General Assembly of the Coordination Committee for the Textile Industries in the European Economic Community (Comitextil), Brussels, 26 April 1977.

223 craintes.’80 Another example is when Haferkamp addressed the fears of the textile industry, speaking at the Friedrich-Ebert-Stiftung in Bonn on 8

November 1979. Yet, Haferkamp also made a point of alerting the industry to the negative consequences for the entire economy, if it did not show some flexibility.81 He warned against protectionism, and of the danger that the

Community would lose out on significant trade opportunities, if it kept on using red-tape and obstructing regulations. He pleaded: ‘Sorgen wir alle mit dafür, daß wir die größten Schwierigeiten nicht uns selber machen!‘ The

Commission wanted a deal with the Chinese and its message to the national textile industries was clear.

The intra-Community politics involved in the negotiations show how the Commission continuously sought to assert its role in relation to the member states. At first, it attempted to maximise its room for manoeuvre by simply assuming that the Council of Ministers had already given it a negotiating mandate deriving from that for the EEC-PRC Trade Agreement.82

However the member states called the Commission back and it had to ask for a new mandate. Furthermore, it sought to link the specific negotiations for the textile agreement with the formulation of general guidelines for a

Community textile and clothing policy which would have increased its authority. Here again, the member states put the brakes on. 83 But the

80 AMAE, AO, prov. 2130, négociation textiles CEE-Chine, Arnaud to Adresse Diplomatie Paris, Beijing, 12 July 1979. 81 ECHA, Speech collection, Haferkamp, "Chancen des Ausbaus der Wirtschaftsbeziehungen der EG in Asien: Japan, China, ASEAN", vor der Friedrich-Ebert-Stiftung in Bonn, 8. November 1979. 82 ECHA, Sommaire des conclusions, Groupe textile/Comité 113, Préparation de la negociation d'un accord avec la Republique populair de Chine dans le secteur textile, réunion du 17 janvier 1979, Brussel, 19 janvier 1979. 83 NA, FV58/297, Commission proposals on general guidelines for a textiles and clothing industry policy, CT3, 29 March 1979.

224

Commission was successful in leading the textile negotiations, and it proved crucial in brokering a deal with the Chinese. The Commission held that the conclusion of an EEC-PRC textile agreement was an absolute political necessity independent of the possible incurred economic cost.84 And Jenkins explained to the Foreign Ministers on 2 and 3 pril that ‘it was obvious that there was wide-spread interest among the member states in the potential of the Chinese market, but it was obvious too that China had to increase her exports to pay for her modernisation programme. It was inconsistent to expect the Commission to act as the apostle of protectionism in these circumstances.’ 85 When the negotiations stagnated because the member states refused to increase the import quota, Jenkins pleaded angrily at an informal meeting of the Foreign Ministers at the Chateau de Mercuès on 12 and 13 May: ‘the member states were being short-sighted in their attitude towards an agreement between China and the Community, particularly over textiles. […] If it continued to be so niggardly, there was a danger that the

mericans would scoop the pool.’86 Jenkins’ push produced results. t the

Council of Ministers meeting on 12 June, the ministers gave a mandate for the Commission to resume negotiations for a sui generis agreement, precisely the formula which the Commission had advocated.87

84 ECHA, Groupe textile/Comité 113, Préparation de la negociation d'un accord avec la Republique populair de Chine dans le secteur textile, réunion du 17 janvier 1979, Brussels, 19 January 1979. 85 NA, FV 58/297, Council of Ministers Foreign Affairs, Luxembourg, 2/3 April 1979, EEC/China textiles negotiations, 3 April. 86 NA, FCO 30/4111, informal meeting of EEC Ministers: Cahors: 12/13 May, Lever to Petrie, London, 15 May 1979. For château and champagne, see http://www.chateaudemercues.com/. 87 CMA, Intermediate Archive, 14391/1979, Relevé des décision de la 583ème session du Conseil des Communautés europénnes en date du 12 juin 1979, Brussels, 18 June 1979; CMA, Intermediate Archive, 14391/1979, Négociations textiles CEE-Chine, Directives en vue d'un compromis, 12 June 1979.

225

Furthermore, the Commission was the key player in putting pressure on the French to give up their obstructionist position. At the heart of the negotiations until their very end stood the EC quota for cotton garments, because the PRC wanted to surpass at least 20200 tonnes, and the French refused to go beyond 14000t or 16000t. When a Commission delegation travelled to Beijing for the first joint committee meeting in July, all parties, except the French, viewed it as paramount to conclude a textile agreement.

Just before leaving for Beijing, Kawan, acting President of the Community delegation at the joint committee, made an error, which was presumably unintentional. He let slip the minimum negotiating position the French internally said that they would accept. This bottom-line on the cotton quota lay at 18000 tonnes. Consequently if the French continued to be inflexible, and the negotiations failed, the French could be blamed for the breakdown.88

The French were furious, but in the end they did accept the Commission’s proposal, and agreed to a deal with the Chinese.89

A general feature of the Commission which the textile negotiations brought out and that was a consistent one throughout the 1969-1979 period is that the Commission proved to be a coherent actor. The internal organisational structure and division of competencies between the different

Directorates did not have a significant impact upon the Commission’s workings. Potential ‘border conflicts’ between the DG I, the Directorate

General for Economic and Finance (DG II), the Directorate General for

Development (DG VIII), and the Directorate General Information (DG XIII)

88 AMAE, AO, prov. 2130, Négociations textiles CEE-Chine, Arnaud to SGCI, Beijing, 12 July 1979. 89 PAAA, B201/411/434, Textilhandelsregelung EG/China, Leyser and Mohrmann to Außenminister, Bonn, 27 July 1979.

226 did not occur. The Commission’s input to the Community’s foreign policy activity towards the PRC lay firmly in the hands of the cabinet of the vice- president responsible for external relations and DGI. This coherence contributed to the Commission’s efficiency, effectiveness and its capacity to assert its role in policy-making.

The French impeded the negotiations due to political reasons. Giscard d'Estaing visited Moscow in April 1979, and blocking negotiations with China certainly made a favourable impression on the Soviet Union.90 André Giraud,

Minister of Industry, travelled to Beijing in July 1979. He wanted to have the

French blockage at a Community level as a potential lever for the Sino-French bilateral negotiations on industrial deals.91 The main reason however lay in domestic politics. As Pierre Achard, Conseiller technique to the Prime

Minister, remarked, from an economic point of view it was clear to everyone that an additional import by 4000t or 5000t of cotton to the EC would not have any major effect on the situation of the French textile sector. And after all it was normal that the PRC would find its place in the MFA arrangements, even if it had not been part of it initially.92

But the real issue was the political necessity of protecting the French textile industry, particularly the cotton sector. The letters by Maurice

Schumann, then acting Deputy President of the Senate, to Raymond Barre,

90 CAC, SGCI files, Versement 19910040, Article 23, 'Paris block on textiles negotiations with China', Guy de Jonquieres, Common Market Correspondent in Luxembourg; NA, FV 58/297, Council of Ministers (Foreign Affairs), EEC/China: textiles, Brussels, 8 May 1979. 91 CAC, SGCI files, Versement 19930085, Article 33, Négociation de l'accord 'Textiles' entre la Communauté et la République populaire de Chine, Achard to Prime Minister, Paris, 5 July 1979. 92 CAC, Versement 19930085, Article 33, négociation de l'accord 'Textiles' ente la Communauté et la République populaire de Chine, Pierre Achard (conseiller technique to Prime Minister) to Prime Minister, Paris, 5 July 1979.

227 the Prime Minister, and Giraud, showed the politicised nature of the issue.93

Schumann forcefully called for the protection of French industry. In the end,

Barre accepted the EEC-PRC Trade Agreement as negotiated by the

Commission because France found itself isolated at the EC, the domestic industry came to accept the 18000t cotton deal, and because the agreement provided significant protection of all other areas in the textile and clothing industry.94

Bonn consistently urged for a compromise with the Chinese mainly because of national economic imperatives. The German economy could not afford losing Chinese trade deals in other sectors if it started to adopt protectionist measures on textiles. 95 Germany was prepared to grant the

Chinese wider access to the European market based on the Commission’s proposals. It was firm in its position that the first joint committee meeting should not fail. 96 However, there were also political arguments behind

Germany’s support. China had consistently supported European integration.

The PRC was gradually assuming an important role amongst the state trading countries. Contrary to the vast majority of the other Communist countries,

Beijing had agreed to negotiate a trade agreement with the Community, and

93 CAC, Versement 19930085, Article 33, Schumann to Barre, Paris, 17 janvier 1979; AN, 5 AG 3, 921, Schumann to Giraud, Paris, 29 May 1979; AN, 5 AG 3, 921, Schumann to de Panafieu, Paris, 29 May 1979. 94 CAC, Versement 19930085, Article 33, négociation de l'accord 'Textiles' ente la Communauté et la République populaire de Chine, Achard to Prime Minister, Paris, 5 July 1979. 95 BAK, BKA, B136/34643, Verhandlungen zwischen der EG und der Volksrepublic China über ein Textilhandelsabkommen, Schwinne to Chef des Bundeskanzleramtes, undated. 96 See for example, PAAA, B21/200 Zwischenarchiv 110507, 583. Tagung des EG-Rates am 12. Juni, Textilabkommen EG/VRChina, Bundesminister für Wirtschaft, Bonn, 7 June 1979.

228 therefore it was politically important for the Community to follow-up this trade agreement. 97

The British were also supportive of the Commission’s proposals despite

London’s concern about the implications for their trade relations with the developing countries and those of the Mediterranean. 98 Writing to the

Secretary of State for Trade on 26 March 1979, Owen recommended a strategy to counter the fears of the British textile industry. He suggested a deal with China and other textile suppliers such as Bulgaria, Malta, Cyprus and Turkey in ‘one clean sweep rather than in a piecemeal [fashion]’.99 In terms of working out a Community position, the British strategy was not to take any sort of lead in putting pressure on the French, but rather to leave this to the Commission.100 London’s reaction to the conclusion of the textile agreement was that it was ‘the best of a bad job’ – it was politically necessary but increased the access of Chinese products to an already saturated EC market. Hence ‘while it is a relief to have a textile agreement we do not think that the UK should be too enthusiastic in congratulating the Commission. A lower profile might serve us better in future textile negotiations with other suppliers.’101

The Cold War dimension played less of a role in the positions and strategies of the French, Germans, British, and the Commission than it had in

97 BAK, BKA, B136/34643, Hermes to Keller, Bonn, 29 March 1979; BAK, BKA, B136/34643, Textilabkommen EG- China, hier: Schreiben der Gewerkschaft Textil-Bekleidung an Bundeskanzler vom 19.03.79, Lautenschlager to Staatsekretär, Bonn, 28 March 1979. 98 NA, FV 58/297, from the Minister of overseas development, Smith, London, 2 April 1979; NA, FV 58/297, Owen to Secretary of State for Trade, 26 March 1979. 99 NA, FV 58/297, Owen to Secretary of State for Trade, 26 March 1979. 100 NA, FV 58/298, EEC/China: Foreign Affairs Council 24 July, Crompton to Willis, 20 July 1979. 101 Ibid.

229 previous decisions on the EC-PRC relationship. Paris’ main concern was not to let down the French national textile industry. Bonn was mainly interested in assuring future trade opportunities with China. London’s priority was not to damage the relations with the developing and Mediterranean countries.

nd the Commission’s motive was to strengthen its hand in relation to the member states, the industries and the trade unions.

Conclusion

The EEC-PRC Trade Agreement proved a landmark in moving the relationship between the Community and China from symbolism to concrete policy measures. Within one and a half years the Community had made major leeway in the implementation of the agreement through its visiting diplomacy, the liberalisation of its market, and the EEC-PRC textile agreement.

Despite the explicit Soviet antagonism, the Community continued to strengthen its links with Beijing. The inherently political statement of the trade agreement spurred the EC to respond to a long-standing request by the

PRC: namely that the Community treat China distinctly from the Soviet bloc.

The EC did so using two economic instruments, autonomous quota regulations, and the GSP. However next to the Cold War dimension, the economic competition by Japan and the United States became an increasingly important factor in the Community’s decision-making, even more so as the Deng Xiaoping reform era began.

The Commission continued as the principal motor of the EC-PRC relations. It used the trade agreement as a launch pad to gain further

230 credentials as EC spokesperson in international affairs. By brokering contacts between the Chinese and the European banking and business sector, the

Commission had found a new instrument for its foreign policy activity with

China. By discussing politics with the Chinese leaders in Beijing just as the

Sino-Vietnamese war had broken out, the Commission demonstrated political presence. The intra-Community politics regarding the textile agreement showed that with the relationship to the PRC becoming more concrete, the member states also proved more touchy and involved on the EC level. Nevertheless the Commission managed the intra-Community conflicts to its institutional advantage, and succeeded in brokering a deal with the

Chinese in the name of the Community. It achieved this by using on the one hand the political argument of the East-West conflict, on the other hand the economic argument of international competition for the lucrative Chinese market.

231

Conclusion A new multi-level diplomacy

‘The speed of progress will no doubt disappoint those anxious to see quick results. But the Community procedures, complex and cumbrous though they may be, do represent a genuine effort to reconcile conflicting viewpoints and to ensure that no-one's vital interests are disregarded or overborne. If they are slow, they are also pretty sure: a deal once struck generally sticks. What is done cannot be undone.’102

FCO Planning Committee, 1973

In the midst of the crises of the 1970s, the Community’s opening to China brought about new dynamics in intra-Community politics and the Cold War.

From its inception the relationship was politicised – contrary to the view that this occurred only in the 1980s.103 Two main reasons account for this. First, the opening linked to the wrangle for competencies within the EC institutional system. Second, the opening was inextricably intertwined with the relationship to both superpowers. The interplay of these reasons characterises the origins of the Community’s relationship to China.

In light of the quote from the FCO Planning Committee above, the end of the Cold War, the establishment of an EU diplomatic service, and the present-day relevance of the EU-China relations, this thesis makes a significant contribution to the history of European integration and the Cold

War by analysing the origins of the Community’s opening to the PRC. With its use of a supranational approach to EU history and recently declassified archival sources, this study contributes to a better understanding of the

102 NA, FCO 49/461, Planning Committee paper on external relations of the EEC, 1973 Jan 01 - 1973 Dec 31. 103 Kapur, China and the European Economic Community.

232

Community’s foreign policy activity, European integration in the 1970s, and the intersection of European integration and the Cold War. This conclusion draws together the main findings of these three dimensions.

Boosting the Community’s foreign policy activity

The Chinese perception of the EC as an actor in its own right as well as

Beijing’s demand to establish official relations and to have greater access to the EC market meant that the member states had limited scope to go it alone, even if they had so wanted. These two key demands by Beijing implied that the issues arising could only emerge within the Community context and could only be handled in that context. The debates at the European Parliament illustrate best the sense of excitement that China generated, and the perceived need by the Europeans to catch the Zeitgeist and establish closer relations with the PRC as it emerged from its self-imposed introspection of the Cultural Revolution. Only the Community-centred and multi-lateral approach which this research has chosen can fully illustrate these developments and offer an adequate level of analysis and explanation.

This study shows that European officials were very aware of China generally calling the shots.104 It adheres to the existing literature to the extent that that the Chinese urge for Community action was the most important source of external pressure. In this respect, a milestone was Zhou Enlai’s interview with Agence France Presse in May 1972 because for the first time a

Chinese representative expressed publicly the PRC’s interest in official

104 Chapter 2, 3.

233 relations.105 Beijing generally set the pace, and this pace largely depended on the domestic political situation in China.106

But the Community did not simply respond defensively to Beijing. The

EC also pursued its own interest, on its own initiative. As far as the two major milestones are concerned – that is, the establishment of official relations in

May 1975, and the signature of the EEC-PRC Trade Agreement in April 1978

– the Community determined the timing. The Community’s foreign policy activity was an incremental process. Yet the opening to China was not simply a matter of ‘spill-over’ which functionalists such as Ernst Haas identify, implying an almost automatic and passive process of further European integration. The opening required conscious political decisions.107 And in the final analysis, intra-Community politics explain the Community’s response to the PRC. In this respect, the Community was purposeful and active, rather than simply reactive.

The Commission was the principal architect and motor of the

Community’s opening to the PRC. It acted as initiator and mediator to advance the relationship to China. Soames was primarily responsible for setting up official EC-PRC relations.108 The thesis also sheds new light on

Soames’ motives in initiating the EC-PRC relationship. At the root of his actions were first, his world-view characterised by the East-West conflict, in which the European Community as such had to have official relations with the People’s Republic second, his personal ambition to be the one

105 Chapter 1. 106 Chapter 1, Chapter 3 107 Haas, The Uniting of Europe. 108 Kapur, China and the European Economic Community; Chapter 2.

234 orchestrating the opening, emulating at the European level what his personal friend Kissinger had helped to do for the United States. Geopolitics were key, however the main factor in his decision to take the initiative, travel to Beijing and set up official relations with the PRC was inter-institutional jockeying for power. And it was this last motive that continued to characterise the particular manner and timing of Community engagement with the PRC.109

The thesis shows that Soames chose to initiate official relations with

China at the time that he did for three reasons: because of the imminent

British referendum on EC membership, the first meeting of the European

Council, and the culmination of the CSCE in Helsinki.110 Soames used China as diplomatic leverage outside superpower politics to bolster the

Commission’s role in world politics and in intra-Community politics.

Moreover, directly engaging with Beijing was a case where the Commission could demonstrate that it did not merely react in ineffective manner to exceptional crises in world politics such as the Yom Kippur War in October

1973. The Commission employed the relationship also to the PRC to demonstrate its political stamina.

From its inception, the Community’s relationship with China was about politics more than economics. In the context of the economic crisis, the fact that the PRC held the potential to complement the EC economy made it easier for Soames to give up his initial opposition to taking the initiative vis-

à-vis Beijing.111 But contrary to Kapur’s emphasis on the general mood of

109 Chapter 4, 5. 110 Chapter 2. 111 Chapter 1, 2.

235 economic optimism amongst the Europeans, the thesis demonstrates that the member states and the Commission were well aware that in fact the volume of trade between the Nine and the PRC was relatively small and likely to remain so for the foreseeable future. 112 Xiyu, Vichitsoratsa, Redmond and Zou thus overstate the economic motives, which served only served to justify broader political ends.113

The Commission employed a wide spectrum of tactics to assert its role in the EC’s foreign policy activity. In relation to Beijing, this included signalling to the Chinese that it was up to them to come to Brussels and initiate official relations.114 When this did not work out, the change in tactics was for Soames to physically seek the contact by travelling to the PRC and offering the political act of setting up diplomatic links.115 During the trade negotiations the tactic was to ‘play it fairly rough’, use the Soviet card, and exploit the Chinese being under political pressure to conclude a deal.116

Vis-à-vis the member states, the Commission successfully used stratagems of secrecy and creating fait accompli117. It worked through the newly created European Council to push for progress. The European Council proved a channel which the Commission used to assert its role within the

Community in external relations, rather than a political actor in its own right

112 Kapur, China and the European Economic Community, p.32. 113 van der Harst, 'Introduction. The Evolution of EU-China relations'; Vichitsorasatra, 'The Evolution of Cooperation between the European Community and East Asia'; Chen, 'From Political Alliance in China's Conception to Comprehensive Partnership in Building'; Redmond and Zou, 'The European Community and China'. 114 Chapter 1. 115 Chapter 2. 116 Chapter 4. 117 Chapter 2, Chapter 4/5.

236 that set the agenda. 118 During the trade negotiations, the Commission published decisions in the press before submitting them to the Council of

Ministers. And it presented only the structure of the trade agreement rather than a full draft to the Council of Ministers to preserve maximum room for manoeuvre.119 Furthermore, the Commission used the trade agreement as a launch pad to gain further credentials as the EC spokesperson. By brokering contacts between the Chinese and the European banking and business sectors, the Commission had found a new instrument for its foreign policy activity with China.120 During the textile negotiations it simply assumed it already had a negotiating mandate and sought to link the negotiations for the specific textile agreement with China to general guidelines for a Community policy. 121 Moreover, the Commission used on the one hand the political argument of the East-West conflict, on the other hand the economic argument of international competition to overcome conflicts between and with the member states. The thesis highlights the uniqueness of the case of

China not only because the Commission enjoyed particularly large room for manoeuvre, but also because it grasped and used it successfully. Therefore, the case of China challenges the conventional narrative of the member states simply side-lining the Commission generally, and specifically in the foreign policy area.

The European Parliament was the first to identify the China issue as one to use to position itself within the EC. In contrast to the Council of Ministers

118 Chapter 3. 119 Chapter 4. 120 Chapter 5. 121 Chapter 5.

237 and the Commission, the EP persistently advocated for an active rather than reactive policy of closer relations between the EC and Beijing. The European

Parliament asserted itself against the Commission. Whereas in 1965 the latter essentially ignored the MEPs queries, by 1979 Haferkamp invited the EP

President to coordinate an official visit to the PRC.122 The biggest diplomatic coup was that Colombo visited China even before Jenkins did.123 Similarly, in relation to the Council of Ministers the EP also employed the China issue to bolster its position. Initially, the EP was not even allowed to put questions to the member states on foreign policy issues, because this was a policy area confined to EPC. But the European Parliament kept pushing. It turned for example the member states’ vote on the PRC’s accession to the UN into a

Community matter. 124 A further result was that by 1978, the Council of

Ministers kept the EP informed about the negotiation stages of the EEC-PRC

Trade Agreement without the EP having to ask for this expressis verbis.125

Even if the MEPs recognised the limited impact they had upon the decision- making, the case of China illustrates that the EP unilaterally assumed a role and created a reality which the member states and the Commission were in the long term hard pressed to ignore.

A hands-off approach by the member states was characteristic of the period of the Community’s opening to China. Contrary to Möckli’s and

Romano’s work, this thesis demonstrates that EPC was not the principal forum were decisions for concerted European policy activity took place. After

122 Chapter 1, Chapter 5. 123 Chapter 5. 124 Chapter 1. 125 Chapter 4.

238 the decision of 16 March 1973, EPC continued to be a mechanism for the Nine to exchange and evaluate information only.126 Furthermore it was not just

EPC that saw its role as being to push for European détente, but the

Commission too.127 Despite the Declaration of European Identity of December

1973 which specifically identified the EC-Chinese relationship as a target to aim at, the establishment of official EC-PRC relations was not a foregone conclusion. After the Declaration of European Identity, the Nine reverted to their passive behaviour.

COREPER did not prove to be the institution that enacted the member states control over the Community’s external relations. 128 Not even

Tindemans’ call for a concerted European approach to China in his report on a European Union in December 1976 changed the member states’ laissez- faire attitude.129 The absence of the Heads of State and Government allowed for the Community’s response. Therefore the use of the auto-biographies and political diaries of the respective statesmen proved of little relevance in explaining the opening. A Franco-German tandem is not discernible in the beginnings of the EC-PRC relationship either. Against Daddow’s claim that

‘Britain has consistently acted as an impediment to supranationalism’ this research shows otherwise. 130 The British were key in supporting the

Commission’s role in liaising with China. And Soames after all was a British national who retained exceptionally close ties with the FCO as this thesis has

126 Chapter 1. 127 Romano, 'The Main Task of the European Political Cooperation', p.81. 128 Contrary to Ludlow, 'The European Commission and the Rise of Coreper', Chapter 1, 2. 129 Chapter 3. 130 Chapter 1, 2, 5; Contrary to Oliver Daddow, Britain and Europe since 1945. Historiographical Perspectives on Integration, (Manchester: MUP, 2004), p.30; Gowland, Turner and Wright, Britain and European Integration since 1945, p.85.

239 demonstrated. On this issue, therefore, enlargement did not lead to a stronger emphasis on intergovernmentalism.131

Whereas European business communities, financial institutions and civil society were active in relation to China, this study does not detect their influence on the decision-making at a Community level. A possible reason for this might be that foreign policy is an area that by definition tends to be secretive and not involve the public. Moreover, in the 1970s China only just started to open to the outside world, and all foreign activity related to forging links with the PRC were still in their infancy. In addition interest groups began only in the 1970s to organise themselves as what today is termed

‘lobbyists’.

In conclusion, the EC’s response to China is an example of how foreign policy became subject to the policy-making regime of the ‘Community method’. The Commission steered the EC’s foreign policy activity, and the

Commission proved competent. 132 Overall, this does not mean the

Community had a ‘China policy’. The EC did not have a clearly defined, coherent set of objectives, and a geopolitical strategy with different political options analysed. But still, a remarkable institutional cooperation allowed overall for smooth and swift decision-making and implementation. What this research also shows is that no matter how bureaucratic the Community system, personal beliefs, ambitions and initiative fundamentally mattered.133

131 Chapter 1, Chapter 2, Chapter 4. 132 Karamouzi, Greece, the EEC and the Cold War 1974-1979. 133 On beliefs and perceptions see for example: Graham Allison and Philip Zelikow, Essence of Decision: The Cuban Missile Crisis, (New York: Longman, 1999); Yaacov Vertzberger, The World in their Minds: Information Processes, Cognition and Perception in Foreign Policy Decisionmaking, (Standford: Stanford University Press, 1990).

240

Whereas the thesis does not suggest that the Community was immensely successful, it points out that it achieved some relevant and lasting steps as the opening quote of this chapter implies. With the benefit of hindsight, the

Community’s response to the PRC foreshadows the European External Action

Service (EEAS), formed on 1 January 2011 which merged the Commission and Council foreign policy departments and brought in diplomats from national diplomatic services.134

European integration and the 1970s

A second striking feature about the China case is that it reveals how the

Community achieved a degree of cooperation and a level of action in the area of foreign policy – an area where coordination, let alone cooperation, was ‘a luxury rather than an absolute necessity.’135 Rather than external relations being ‘sterilised’, because it revealed too many frictions and threatened the cohesion of the Community, the case of China shows how cooperation intensified, and contributed to cement the supranational loci of power.136 The main implications of the opening were a furthering and deepening of

European integration, and an acceleration of European détente and détente in Europe.

Adding to the puzzlement, the EC achieved setting up relations with

China in a decade commonly associated with ‘Eurosclerosis’.137 The case of the

PRC therefore adds to the growing number of examples that qualify the

134 European Union External Action, 'The High Representative of the Union for Foreign Affairs and Security Policy' European Union. http://www.eeas.europa.eu/ashton/index_en.htm. 135 Ludlow, The European Community and the Crises of the 1960s. 136 Calandri, ‘La CEE et les relations ext rieures 1958-1960’, p.431. 137 See for example: Middlemas, Orchestrating Europe; McAllister, European Union; Olivi, L'Europe difficile.

241 portrayal of the 1970s as a dismal decade, alongside the activity of the Court of Justice, the creation of the European Council, the direct elections of the

EP, the inauguration of the EMS, the first enlargement and Greece’s accession to the EC.138 This would suggest that boom times are far from being an essential condition for European integration to continue.139 Crises can be conducive too.

European integration and the Cold War

The analysis of the Community’s opening to China demonstrates that

European integration and the Cold War did not evolve separately, but intersected.140 The intersection becomes apparent in four main ways. First, the European decision-makers operated in a mentality which naturally squared the Cold War and European integration. Second, individual EC institutions, particularly the European Parliament and the Commission, capitalised on détente using it to assert their own role in EC decision-making.

Third, superpower détente meant that the EC could act vis-à-vis a country where Cold War politics had previously restricted its room for manoeuvre.

The Community generated its own meaning of d tente and acted as a ‘Third

Force’. Lastly, the extension of the Community’s foreign policy activity to

138 Morten Rasmussen, 'The Study of the EC Court of Justice and Community Law as a new Research Field', in Johnny Laursen (ed.), From Crisis to New Dynamics: the European Community 1973-1983, (forthcoming); Migani and Varsori (eds.), Europe in the International Arena during the 1970s, Mourlon-Druol, 'Filling the EEC Leadership Vacuum?; Rittberger, Building Europe's Parliament; Mourlon-Druol, A Europe Made of Money; Furby, 'The Revival and Success of Britain's Second Application for Membership of the European Community, 1968-1971'; Karamouzi, Greece, the EEC and the Cold War 1974-1979. 139 Ludlow, 'Governing Europe: Charting the Development of a Supranational Political System'. 140 ——— (ed.), European Integration and the Cold War; Yamamoto, 'Détente or Integration?'; Romano, 'The Main Task of the European Political Cooperation'.

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China furthered détente in Europe. It contributed to increased contacts with the Soviet bloc.

All the interviews conducted for the purpose of this study evoked the ubiquitous Cold War prism, in which the European decision-makers operated, and which ran alongside their commitment to European integration. This did not merely colour attitudes, but more so, it defined actions towards China. The conviction was that the Community as such simply had to liaise with China if it wanted to matter. The archival sources, especially those by the Commission and the Council of Ministers, very rarely allude to, and even less explicitly state this motivation. This might be due to their bureaucratic nature, and the fact that many key discussions over lunches, dinners, teas and drinks went unrecorded – the historian’s challenge and a call for imagination.

The Community’s opening to China reveals the impact of the Cold War on intra-Community politics. Not only Third World political elites, but also

European ones instrumentalised the East-West conflict for power political interests.141 Seeking European détente beyond Europe allowed the European

Parliament and above all the Commission to assert their say against the member states, who operated through the Council of Ministers, COREPER, the EPC and the European Council. Détente gave the EP and the Commission leverage in defining the future role of the Community in external relations.

Thus this study qualifies in important respect Ludlow’s argument that ‘the minimal nature of the European Community’s direct involvement in the Cold

141 Westad, The Global Cold War.

243

War was not […] a fluke or accident. Instead it reflected both a degree of bureaucratic logic and the two underlying realities of Western Europe’s ongoing security dependence on the United States and its deep internal division about its foreign policy choices.’142 Instead it shows how the Community had a direct involvement in the Cold War because first it sought to emancipate itself from the dependence on the United States, second the supranational institutions proved to be the most adept in testing the waters in this respect, and third the decision-makers operated with a Cold War mentality.

This research substantiates the claim that the Cold War is an essential factor to explain how and why the Community and the Chinese set up official relations concluded a trade agreement and followed it up swiftly in less than a decade. The thesis adds that the Cold War factor also accounts for why the

Commission and the Nine overcame intra-Community conflicts so quickly.

This thesis therefore shows that the wrangle for competencies within the EC institutional system intertwined with broader trends of history, the end of the

PRC’s isolation from international affairs and d tente.

Nixon’s visit to China in 1972 made it possible for the Nine to agree that the Community as such should have official relations with the People’s

Republic.143 In contrast to the EC-Japan and the EC-South Korea relations however, the Community and China established a relationship without the direct involvement of the United States. 144 Furthermore, the Community proved more successful than Washington in forging diplomatic and economic

142 Ludlow, 'An Insulated Community?'. 143 Chapter 1. 144 Vichitsorasatra, 'The Evolution of Cooperation between the European Community and East Asia'.

244 links with Beijing. The EC positioned itself against the United States as a unified actor who pursued global and not merely regional interests.145 Thus this research supports Trachtenberg’s view that European integration ‘was a way for the Europeans to reclaim their political autonomy’ against Waltz’s argument that the relations with the United States were largely de- politicised.146

The Sino-Soviet rivalry enabled the Commission on the one hand to play the Soviet card vis-à-vis the Chinese. On the other hand, it meant the

Commission also played the China card vis-à-vis the Soviet Union in order to increase the EC’s weight in international affairs.147 Despite Soviet antagonism the Community strengthened its links to Beijing. Both, the establishment of diplomatic relations with the accreditation of a Chinese diplomat to the

Community and the EEC-PRC Trade Agreement, set political precedents for the EC’s interaction with the Soviet Union and the Communist countries of

Eastern Europe. Therefore the relationship with China is an essential piece in the puzzle of the EC’s external relations with the Communist world which so far the historiography both on the Cold War and European integration has neglected.

The analysis shows that the Community successfully liaised with the

PRC even though the latter did not share the EC’s aspirations for d tente in

Europe – meaning the relaxing of the East-West bloc confrontation in order to overcome the division on the European continent. It highlights how the

145 Chapter 1, Chapter 2, Chapter 3, Chapter5. 146 Trachtenberg, Between Empire and Alliance, p.viii; Waltz, Theory of International Politics. 147 Especially chapter 2 and chapter 4.

245

Commission implemented in relation to China some essential aspects of the agenda the Community pursued during the CSCE: conducting both commercial and human relations independently of the political and ideological nature of a system. The Europeans proved to adopt a very pragmatic strategy towards Communist China. In this sense, the concept of

Europe acting as a ‘Third Force’ acquired a new meaning.

Furthering European integration, meaning here extending EC foreign policy activity to China, contributed to détente in Europe. The Europeans interpreted COMECON’s new approaches to the EC as partly motivated by

Soviet fears of losing out against China, and losing control over Eastern

European bilateral dealings with the Community. The burgeoning EC-PRC relationship featured regularly on the agenda of the increasing contacts between the Commission and the Soviet and Eastern European representatives. Thus a truly global Cold War history needs to take into account new actors – the European Community and its individual institutions, in particular the European Parliament and the Commission. It has to acknowledge a new form of diplomacy – a collective European one.

And a truly global Cold War history needs to incorporate a new relationship – the EC-China one.

246

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Appendices

Appendix 1: World map in 1979

Color scheme: blue: EC; yellow: PRC and its allies; red: Warsaw Pact member states

Source: adapted from Chabacano, World map in 1980, during the later stages of the Cold War, 7 July 2007, licensed under the Creative Commons Attribution-Share Alike 3.0 Unported, http://creativecommons.org/licenses/by-sa/3.0/deed.en

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Appendix 2: European Community of the Six and Nine, USSR and Socialist countries aligned with the USSR in Europe, 1979

Color scheme: blue: EC founding member states, light blue: EC member states of the first enlargement, red: Soviet Union; light red: Socialist countries aligned with the Soviet Union; pink: Soviet influence; Karo symbol: COMECON member states active in 1969-1979

Source: adapted from Kolja21, European Community (EC), USSR and satellite states (1957/58), 29 May 2009, licensed under the Creative Commons Attribution 3.0 Unported, http://creativecommons.org/licenses/by/3.0/deed.en

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